FOR: FIRSTSERVICE CORPORATION

COMPANY CONTACT:
Jay S. Hennick
President & Chief Executive Officer
FirstService Corporation
(416) 960-9500

D. Scott Patterson
Senior Vice President & CFO
FirstService Corporation
(416) 960-9500

INVESTOR RELATIONS:
Jeffrey Elliott
Jeffrey Elliott Communications
(919) 968-4085

FOR IMMEDIATE RELEASE

Nasdaq: FSRV
TSE: FSV

 

FIRSTSERVICE REPORTS 31% EPS GROWTH IN FIRST QUARTER

 

TORONTO, Ontario (July 25, 2000) -- FirstService Corporation today announced record financial results for the first three months of fiscal 2001, including a 24% increase in revenues to US $105.4 million from US $84.9 million a year earlier, and a 29% jump in EBITDA to US $14.5 million from US $11.2 million.

Net earnings were US $4.7 million, up 31% over the prior year period, while diluted earnings per share increased 31% to US $0.34 from US $0.26.

"First quarter results reflect a continuation of our strong operating performance during the fiscal year ended March 31, 2000", said Scott Patterson, Senior Vice President and Chief Financial Officer. "All of our operations are meeting or exceeding internal budgets and we are confident of achieving our financial growth targets for the current fiscal year", he concluded.

Revenue from Property Services was US $86.4 million, an increase of US $17.3 million or 25% over the prior year. Approximately US $8.0 million of the revenue increase resulted from acquisitions, including American Pool Enterprises which closed effective June 1, 1999 and several tuck-under companies. The balance of the increase resulted from continued strong internal growth.

Revenue from Business Services rose to US $19.0 million for the quarter, a 20% increase over the prior year, reflecting both solid internal growth and the impact of the acquisition of DDS Southwest which closed at the end of the first quarter last year.

Subsequent to the end of the first quarter, FirstService completed five tuck-under acquisitions which added more than US $20.0 million in annual revenue, increased the total number of properties and residential units under management to more than 1,800 and 350,000, respectively, and expanded the breadth of services offered to managed communities.

FirstService Corporation is a leader in the rapidly growing service sector, providing a variety of specialized property and business outsourcing services--including residential property management, security, consumer services and data processing and specialized trade material fulfillment--to a variety of customers throughout North America. Top and bottom line growth have exceeded the company's 20% annual threshold objective for eight years in a row.

Certain statements included in this release constitute "forward-looking statements" within the meaning of the U.S. Private Securities Litigation Reform Act of 1995 (the "Reform Act"). Such forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Company, or industry results, to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Such factors include, among others, the following: general economic and business conditions, which will, among other things, impact demand for the Company's services, service industry conditions and capacity; the ability of theCompany to implement its business strategy, including the Company's ability to acquire suitable acquisition candidates on acceptable terms and successfully integrate newly acquired businesses with its existing businesses; changes in or the failure to comply with government regulations (especially safety and environmental laws and regulations); and other factors which are described in the Company's filings with the Securities and Exchange Commission.



FIRSTSERVICE CORPORATION

Consolidated Statements of Income (Unaudited)

Three month periods ended June 30
 

2000

1999

Revenue

$105, 391

$84, 907

Cost of revenue

69, 380

56, 070

Selling, general and administrative expenses

21, 554

17, 593

EBITDA

14, 457

11, 244

Depreciation

1, 741

1,470

Amortization

977

814

Interest

2, 234

1, 763

Earnings before the following:

9, 505

7, 197

Income taxes

3, 800

2, 859

Earnings before minority interest

5, 705

4, 338

Minority interest share of earnings

1, 026

754

Net Earnings

$4, 679

$3, 584

Earnings per share:Basic

$0.36

$0.28

Diluted

$0.34

$0.26

Weighted average shares outstanding: Basic

13, 042

12, 924

Diluted

13,648

13, 788



Condensed Consolidated Balance Sheets

(in thousands of U.S. dollars)

As At June 30 (Unaudited)
As At March 31 (Audited)

Assets

2000

1999

Cash and cash equivalents

$3, 489

$3, 297

Accounts receivable (net)

60, 106

53, 170

Inventory and other current assets

18, 973

18, 483

Current assets

82, 568

74, 950

Goodwill

122, 791

117, 495

Fixed assets

30, 780

29, 693

Other assets

9, 942

8, 749

Total Assets

$246, 081

$230, 887

Liabilities and equity

Accounts payable and other current liabilities

$38, 287

$38, 103

Unearned revenue

14, 627

10, 725

L.T. debt - current

2, 813

2, 733

Current liabilities

55, 727

51, 561

Long term debt net of current portion

109, 653

102, 177

Deferred income taxes

1, 746

1, 836

Minority interest

7, 906

6, 975

Shareholders' equity

71, 049

68, 338

Total liabilities and equity

$246, 081

$230, 887


The Consolidated Statements of Earnings and Balance Sheets have been prepared in accordance with U.S. GAAP.