Information Services Corporation (TSX:ISV) has reported a big rise in fourth-quarter and full-year 2021 revenue due to strong activity in the Saskatchewan real estate sector, which drove increased revenue in the Saskatchewan Land Registry.
The company also attributed a 13% increase in 4Q revenue to $44.2 million to continued organic growth in its Services segment through integrated technology-driven product offerings.
Information Services Corporation (ISC) said net income for the three months to December 31, 2021, was $10.3 million or $0.59 per basic share, up from $7.9 million or $0.45 per basic share in 4Q 2020, and it has declared a quarterly cash dividend of $0.23 per ‘A’ share.
READ: Information Services Corp expects strength of core business to continue in 2022
"2021 was a remarkable year for ISC. Not only did we continue to grow our Services business in the face of a global pandemic, but we experienced outstanding results in our Saskatchewan-based registries,” the company’s president and CEO Shawn Peters said in a statement.
"We see continued strength across our business in 2022, and I'm looking forward to building upon that strength with expanded products and services while putting our balance sheet to work by executing on our acquisition strategy,” he added.
ISC noted that its underlying earnings (EBITDA) margin declined to 39.8% from 40.2% in 4Q 2020, largely due to the impact of coronavirus (COVID-19) on its Technology Solutions segment, as well as changes to revenue recognition in its Services segment as it moved customers to the Registry Complete platform.
For the 12 months to December 31, 2021, the company reported revenue of $169.4 million, an increase of 24% from 2020, which it also attributed to higher revenue in Registry Operations driven by robust activity in the Saskatchewan real estate sector, increases in personal property security registrations and new business entity registrations.
“This was accompanied by continued organic growth in our Services segment through new customer acquisition and the use of technology, including Registry Complete, offering an integrated suite of services to our clients and a full year of operations from our new Recovery Solutions division compared to five months in the prior year,” ISC said.
Net income was $32.1 million or $1.83 per basic share, compared to $20.8 million or $1.19 per basic share, while EBITDA increased to $60.5 million from $43.4 million in 2020.
The company ended the year with free cash flow of $44.8 million, an increase of $8.6 million, due to higher results of operations and strong cash flow conversion of the business. Cash at the end of the year amounted to $40.1 million, up from $33.9 million on December 31, 2020, and it had total debt of $41 million compared to $76.3 million a year earlier.
ISC said it expects to see continued strength in 2022 across its two largest operating segments, Registry Operations and Services, with both benefitting from strong economic conditions in 2021, including an overall positive impact on transaction and seasonality trends during the pandemic.
“While the pandemic has disrupted various sectors of the Saskatchewan economy, Registry Operations has experienced exceptional results in 2021, mainly due to the robust real estate sector in Saskatchewan. While we do not expect the strong economic activity experienced in 2021 will continue indefinitely, we believe 2022 will still exceed pre-pandemic levels," the company concluded.
Information Services Corporation provides registry and information management services for public data and records and is focused on sustaining the core registry business while pursuing new growth opportunities.
The company has a host of diversified, yet complementary revenue streams through its three business segments: Registry Operations, Services and Technology Solutions.
Contact the author at stephen.gunnion@proactiveinvestors.com