Stantec reports strong results for 2012 year-end and an increased dividend

Stantec reports strong results for 2012 year-end and an increased dividend 
EDMONTON, ALBERTA -- (Marketwire) -- 02/21/13 -- (TSX:STN) (NYSE:STN) 
Today, Stantec announced strong results for 2012, with several key
items to highlight 


 
--  Gross revenue increased 11.9% year over year to C$1,882.9 million from
    C$1,683.4 million 
--  Net income increased 17.7% year over year to C$120.9 million from
    C$102.7 million and diluted earnings per share increased 17.3% to C$2.64
    from C$2.25, excluding the impact of a $90.0 million goodwill impairment
    charge in 2011 
--  The Company completed seven acquisitions, adding approximately 1,170
    staff and expanding its geographic reach 
--  The Company declared a quarterly dividend of $C0.165, an increase of 10%

 
"The year 2012 marked our 59th year of uninterrupted profitability at
Stantec, demonstrating the results of effectively executing our
strategy," says Bob Gomes, Stantec president and chief executive
officer. "We achieved strong growth and exceeded our expectations for
the year thanks to the excellence demonstrated by our employees in
their commitment to the clients and communities they work with every
day." 
Stantec's revenue growth in Q4 12 was strong compared to Q4 11. Gross
revenue increased 12.0% to C$483.9 million from C$432.0 million, and
EBITDA increased 20.3% to C$56.3 million from C$46.8 million.
Excluding the impact of a $90.0 million non-cash goodwill impairment
charge in 2011, the Company's net income increased 28.0% to C$31.1
million from C$24.3 million, and diluted earnings per share increased
26.4% to C$0.67 from C$0.53. Net income during Q4 12 was positively
impacted by an increase in gross revenue and an increase in gross
margin as a percentage of net revenue from 55.1% in Q4 11 to 56.1% in
Q4 12. 
Focus on Executing on Strategy and Market Opportunities 
In 2012, Stantec focused on executing its long-term strategy and
capitalizing on market opportunities. Because of Stantec's depth and
breadth of expertise, leveraging this focus resulted in securing
projects with new and existing clients across geographic regions and
practice areas. 
Stantec strengthened its capacity in the mining, oil and gas, and
power sectors through both organic growth and strategic acquisitions.
This increased capacity led to securing work in Eagle Ford, Texas,
providing construction management oversight and regulatory support to
the gas industry, as well as working on a pipeline expansion project.
Stantec continued to leverage client relationships and capitalize on
its integrated presence across North America, resulting in multiple
pipeline projects providing services such as overall technical
coordination of environmental assessments and leading emergency
response planning. Stantec also provided consulting services to two
liquefied natural gas projects and associated port facilities. 
Stantec's ability to develop strong, long-lasting client
relationships meant new opportunities. This included work with the
North Carolina Department of Transportation for a large multi-year
project completing studies for proposed improvements to a section of
NC 150 northeast of Charlotte, North Carolina. Strategic acquisitions
also increased the Company's market presence, leading to significant
new projects. For example, Stantec was selected for a design-build
project in Louisville, Kentucky, where the Company will provide a
cross-section of services, including roadway and bridge design,
lighting, landscaping, permitting, and geotechnical engineering
services for a new Ohio River bridge and system interchanges. 
Stantec also continued to pursue market opportunities in both
residential and nonresidential markets, particularly in areas where
markets showed signs of recovery. This effort resulted in securing
design work for the Lakewood Ranch Country Club East Golf Course
community expansion in Sarasota, Florida. In addition, despite
softening of some markets, Stantec continued to secure work in key
sectors such as healthcare, including a project for the Cleveland
Clinic in Cleveland, Ohio, to perform programming, architectural, and
interior design services for a major expansion to the Taussig Cancer
Institute. 
Continued Growth 
Stantec is well positioned for 2013 to take advantage of continued
opportunities in Canada and an emerging recovery in US markets. The
Company completed seven acquisitions in 2012-four of those in the
fourth quarter-which expanded the depth and breadth of its expertise
in the oil and gas industry, in particular in western Canada, and its
transportation and urban development expertise in the United States.
This continued growth reinforces the Company's goal of being a top 10
global design firm while also expanding its position in North America
and strengthening its diverse service offerings and relationships
with both local/regional and global/national clients. 
Additional Company Activity 
Today, Stantec's board of directors declared a quarterly dividend of
C$0.165 per share, an increase of 10%. It is payable on April 18,
2013, to shareholders of record on March 29, 2013. 
Stantec would like to recognize the contributions of former board
member Mr. Robert Bradshaw. In the fourth quarter of 2012, Mr.
Bradshaw stepped down from his position on Stantec's board of
directors. He has been associated with the Company since 1993 and was
part of the team that took the Company public in 1994. He was
appointed chairman of the board from 1994 to 1998. During his time
with Stantec, Mr. Bradshaw demonstrated exemplary dedication and
leadership. 
The Stantec board of directors is pleased to announce that on
February 20, 2013, it passed a resolution appointing Donald Lowry of
Edmonton, Alberta, to the board. This appointment will take effect
May 8, 2013. Mr. Lowry is currently the president and chief executive
officer of EPCOR Utilities Inc., and will be stepping down from this
role later this year. He is also the non-executive chair of Capital
Power Corporation and Canadian Oil Sands Ltd., and is a member of the
board of directors of Hydrogenics Corporation. Mr. Lowry brings
leadership and industry expertise to the Stantec board. 
Conference Call and Company Information 
Stantec's fourth quarter and year-end conference call, to be held
Thursday, February 21, 2013, at 2:00 PM MST (4:00 PM EST), will be
broadcast live and archived in the Investors section of
www.stantec.com. Financial analysts who wish to participate in the
earnings conference call are invited to call 1-800-820-0231 and
provide confirmation code 8780489 to the operator. 
Stantec's Annual Meeting of Shareholders will be held on May 9, 2013,
at 10:30 AM MDT (12:30 PM EDT) at MacEwan University's Alberta
College Campus in Edmonton, Alberta, 10050 MacDonald Drive. 
Stantec provides professional consulting services in planning,
engineering, architecture, interior design, landscape architecture,
surveying, environmental sciences, project management, and project
economics for infrastructure and facilities projects. We support
public and private sector clients in a diverse range of markets at
every stage, from the initial conceptualization and financial
feasibility study to project completion and beyond. Our services are
provided on projects around the world through approximately 12,000
employees operating out of more than 200 locations in North America
and 4 locations internationally. Stantec is One Team providing
Integrated Solutions. 
Cautionary Statements 
Stantec's EBITDA is a non-IFRS measure, and gross revenue and net
revenue are additional IFRS measures. For a definition and
explanation of non-IFRS measures and additional IFRS measures, refer
to the Critical Accounting Estimates, Developments, and Measures
section of the Company's 2012 Financial Review. 
This press release contains forward-looking statements concerning
Stantec's future financial performance, future growth, and future
acquisitions activities. By their nature, forward-looking statements
require us to make assumptions and are subject to inherent risks and
uncertainties. We caution readers of this press release not to place
undue reliance on our forward-looking statements since a number of
factors could cause actual future results to differ materially from
the expectations expressed in these forward-looking statements. These
factors include, but are not limited to the risk of an economic
downturn, changing market conditions for Stantec's services,
disruptions in government funding, the risk that Stantec will not
meet its growth or revenue targets and the risk that the contemplated
transactions will not close when expected or at all. Investors and
the public should carefully consider these factors, other
uncertainties, and potential events as well as the inherent
uncertainty of forward-looking statements when relying on these
statements to make decisions with respect to our Company. 
For more information on how other material factors and other factors
could affect our results, refer to the Risk Factors section and
Cautionary Note Regarding Forward-Looking Statements in our 2012
Financial Review. Stantec's 40-F has been filed with the SEC and you
may obtain this document by visiting EDGAR on the SEC website at
www.sec.gov. Our 2012 Financial Review is also available at the CSA
website at www.sedar.com, or at www.stantec.com. Alternatively, you
may obtain a hard copy of the Financial Review free of charge upon
request to our Investor Contact noted below. 
One Team. Integrated Solutions. 


 
         - Continued, Income Statement and Balance Sheet attached -         
                                                                            
                Consolidated Statements of Financial Position               
                                                                            
                                                 December 31    December 31 
                                                        2012           2011 
(In thousands of Canadian dollars)                         $              $ 
----------------------------------------------------------------------------
                                                                            
ASSETS                                                                      
Current                                                                     
Cash and cash equivalents                             41,753         36,111 
Trade and other receivables                          355,955        310,669 
Unbilled revenue                                     150,523        133,881 
Income taxes recoverable                               3,811         16,800 
Prepaid expenses                                      14,336         13,908 
Other financial assets                                18,701         14,612 
Other assets                                           4,106          3,172 
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Total current assets                                 589,185        529,153 
Non-current                                                                 
Property and equipment                               115,086        107,853 
Goodwill                                             566,784        509,028 
Intangible assets                                     85,748         72,047 
Investments in associates                              3,508          2,365 
Deferred tax assets                                   40,975         43,647 
Other financial assets                                63,565         61,606 
Other assets                                           3,791          1,657 
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Total assets                                       1,468,642      1,327,356 
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LIABILITIES AND EQUITY                                                      
Current                                                                     
Trade and other payables                             216,104        191,859 
Billings in excess of costs                           60,822         49,441 
Income taxes payable                                     159              - 
Current portion of long-term debt                     42,888         59,593 
Provisions                                            14,863         16,373 
Other financial liabilities                            1,672          5,042 
Other liabilities                                      8,650          5,208 
----------------------------------------------------------------------------
                                                                            
Total current liabilities                            345,158        327,516 
Non-current                                                                 
Long-term debt                                       256,408        236,601 
Provisions                                            36,959         42,076 
Deferred tax liabilities                              57,842         54,564 
Other financial liabilities                            2,342          2,257 
Other liabilities                                     42,778         37,191 
----------------------------------------------------------------------------
                                                                            
Total liabilities                                    741,487        700,205 
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Shareholders' equity                                                        
Share capital                                        240,369        226,744 
Contributed surplus                                   14,291         14,906 
Retained earnings                                    491,251        397,847 
Accumulated other comprehensive loss                 (18,859)       (12,449)
----------------------------------------------------------------------------
                                                                            
Total equity attributable to equity holders of                              
 the Company                                         727,052        627,048 
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Non-controlling interests                                103            103 
----------------------------------------------------------------------------
                                                                            
Total equity                                         727,155        627,151 
----------------------------------------------------------------------------
                                                                            
Total liabilities and equity                       1,468,642      1,327,356 
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                     Consolidated Statements of Income                      
                                                                            
Years ended December 31                                 2012           2011 
(In thousands of Canadian dollars, except per                               
 share amounts)                                            $              $ 
----------------------------------------------------------------------------
                                                                            
Gross revenue                                      1,882,900      1,683,403 
Less subconsultant and other direct expenses         326,506        304,856 
----------------------------------------------------------------------------
                                                                            
Net revenue                                        1,556,394      1,378,547 
Direct payroll costs                                 700,853        615,136 
----------------------------------------------------------------------------
                                                                            
Gross margin                                         855,541        763,411 
Administrative and marketing expenses                633,171        565,164 
Depreciation of property and equipment                27,875         27,933 
Impairment of goodwill                                     -         90,000 
Amortization of intangible assets                     20,008         18,395 
Net interest expense                                   8,658          9,723 
Other net finance expense                              2,773          2,848 
Share of income from associates                       (1,765)          (793)
Foreign exchange loss                                    181            501 
Other expense (income)                                   147            (36)
----------------------------------------------------------------------------
                                                                            
Income before income taxes                           164,493         49,676 
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Income taxes                                                                
Current                                               44,661         32,733 
Deferred                                              (1,070)         4,281 
----------------------------------------------------------------------------
                                                                            
Total income taxes                                    43,591         37,014 
----------------------------------------------------------------------------
                                                                            
Net income for the year                              120,902         12,662 
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Earnings per share                                                          
Basic                                                   2.64           0.28 
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Diluted                                                 2.64           0.28 
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Contacts:
Media Contact
Sherry Brownlee
Stantec Media Relations
(780) 917-7264
sherry.brownlee@stantec.com 
Investor Contact
Crystal Verbeek
Stantec Investor Relations
(780) 969-3349
crystal.verbeek@stantec.com