FirstService(US:FSV)2024-02-06 22:58Financial Data and Key Metrics Changes - For the full year, revenues increased by 16% over 2022, with EBITDA up 18% and organic growth at 10% [67][92] - Adjusted EPS for the fourth quarter was $1.11, down from $1.22 in the previous year, while full-year adjusted EPS was $4.66, up 10% from $4.24 in 2022 [71][72] - The company reported consolidated revenues of $1.08 billion for Q4, up 6% year-over-year, with adjusted EBITDA of $103.3 million, reflecting a 1% increase [92] Business Line Data and Key Metrics Changes - FirstService Residential revenues were up 12% in Q4, with organic growth of 9%, driven by new contract wins across North America [88] - The Brands division saw revenues increase by 1% in Q4, but organic growth declined by 7% due to headwinds in restoration brands [104] - Century Fire reported strong organic growth near 20%, with performance across installation, service, and inspection [4] Market Data and Key Metrics Changes - The company expects continued strong results in 2024, with top-line growth projected in the low-teens percentage range, including approximately $400 million from the Roofing Corp acquisition [12][67] - The restoration operations faced challenges due to mild weather, leading to lower revenues compared to the previous year [3][8] Company Strategy and Development Direction - The company aims to leverage synergies between restoration and roofing businesses, focusing on repair, maintenance, and restoration of the built environment [5][90] - The Roofing Corp acquisition is seen as a strategic move to enhance market presence and capitalize on growth opportunities in a consolidating industry [31][90] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the growth potential in the roofing sector, emphasizing the importance of local market relationships and service delivery [47][70] - The company anticipates a shift to mid-single-digit organic growth in 2024, with expectations of modest gains despite macroeconomic headwinds [69][76] Other Important Information - The company incurred $25 million in capital expenditures during Q4, with full-year CapEx totaling $93 million, lower than the target of $100 million [10] - An 11% increase in dividends was approved, raising the annual dividend to $1 per share, marking a decade of consistent dividend growth [75] Q&A Session Summary Question: What are the expectations for organic growth in Q1? - Management indicated that Q1 organic growth is expected to be down about 10% from the prior year due to the absence of significant storm-related revenue [62][54] Question: How does the company view the roofing business in relation to restoration? - Management highlighted that roofing is complementary to restoration, with opportunities for collaboration and growth in both sectors [81][90] Question: What are the trends in the home improvement brand? - Lead activity remains sluggish, but management expects modest gains through continued investment in marketing and lead conversion strategies [102]