Information Services Corporation (TSX:ISV) (ISC) has reported a 5% jump in second-quarter revenue to $53.5 million driven by increased services revenue, spurred by transaction and customer growth in regulatory solutions and additional third-party revenue in technology solutions resulting from progress on both ongoing and new contracts.
The company noted that registry operations also contributed to its revenue boost, as three full months of results from the Ontario Property Tax Assessment Services division were included, compared to just one month in the year-ago quarter following its acquisition on June 1, 2022.
The leading provider of registry and information management services for public and data records reported adjusted net income for 2Q of $9.3 million or $0.51 per diluted share, compared to $10.8 million or $0.60 per diluted share in the year-ago quarter.
The company noted that the decrease in earnings was primarily related to a drop in Saskatchewan Land Registry revenue on reduced activity in the Saskatchewan real estate sector during the quarter, higher amortization related to intangible assets arising from the acquisition of the Ontario Property Tax Assessment Services division in 2022, and a higher net finance expense.
The company exited the quarter with $26.6 million in cash.
“Our financial performance for the second quarter and first half of 2023 is a reflection of the robust nature of ISC’s business segments as well as the benefit of a diverse revenue stream,” ISC CEO Shawn Peters said in a statement.
“While successive increases to interest rates by the Bank of Canada have affected activity in the Saskatchewan Land Registry in particular, the upside to this is that the regulatory solutions division in services had a strong quarter, driven by many of our financial institution customers implementing stronger due diligence because of a higher interest rate environment.”
ISC said it remains confident in its long-term potential, forecasting revenue between $207 and $212 million for the year and adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) between $71 million and $76 million.
Meanwhile, the company announced that it has declared a quarterly dividend of $0.23 per Class A Limited Voting Share to be paid on or before October 15, 2023, to shareholders of record as of September 30, 2023.
Contact the author at emily.jarvie@proactiveinvestors.com
Follow her on Twitter @emilyjjarvie