CONNECTING THE GLOBAL REAL ESTATE MARKETPLACE TSX:AIF INVESTOR PRESENTATION July 2016
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C O N N E C T I N G T H E G L O B A L R E A L E S T A T E M A R K E T P L A C E T S X : A I F
INVESTOR
PRESENTATION July 2016
2
FORWARD LOOKING STATEMENTS
Certain information in this presentation may constitute “forward-looking information” within the meaning of applicable securities legislation. All
information contained in this presentation, other than statements of current and historical fact, is forward-looking information. Forward-looking
information includes information that relates to, among other things, objectives, strategies and intentions, and future financial and operating
performance and prospects. Generally, forward-looking information can be identified by use of words such as “may”, “will”, “expect”, “believe”,
“plan”, “would”, “could” and other similar terminology. All of the forward-looking information in this presentation is qualified by this cautionary
statement. Forward-looking information includes, but is not limited to, the discussion of Altus Group’s business and operating initiatives; its
expectations of future performance for its various business units and its consolidated financial results; and its expectations with respect to cash
flows and its level of liquidity.
Forward-looking information is not, and cannot be, a guarantee of future results or events. Forward-looking information is based on, among other
things, opinions, assumptions, estimates and analyses that, while considered reasonable by Altus Group at the date the forward-looking
information is provided, inherently are subject to significant risks, uncertainties, contingencies and other factors that may cause actual results,
performance or achievements, industry results or events to be materially different from those expressed or implied by the forward-looking
information. The material factors or assumptions that were identified and were applied by Altus Group in drawing conclusions or making forecasts
or projections set out in the forward-looking information include, but are not limited to: the successful execution of Altus Group’s business
strategies; consistent and stable economic conditions or conditions in the financial markets; consistent and stable legislation in the various
countries in which Altus Group operates; no disruptive changes in the technology environment; the opportunity to acquire accretive businesses;
the successful integration of Altus Group’s businesses; and the continued availability of qualified professionals.
Inherent in the forward-looking information are known and unknown risks, uncertainties and other factors that could cause Altus Group’s actual
results, performance or achievements, or industry results, to differ materially from any results, performance or achievements expressed or implied
by such forward-looking information.
Given these risks, uncertainties and other factors, investors should not place undue reliance on forward-looking information as a prediction of
actual results. The forward-looking information contained herein is current as of the date of this presentation and, except as required under
applicable law, Altus Group does not undertake to update or revise it to reflect new events or circumstances. Additionally, Altus Group
undertakes no obligation to comment on analyses, expectations or statements made by third parties in respect of Altus Group, its financial or
operating results, or its securities. Please consult Altus Group’s most recent regulatory filings on SEDAR for more information on the Company’s
forward-looking statements.
3
ALTUS GROUP AT A GLANCE
C O N N E C T I N G T H E G L O B A L R E A L E S T A T E M A R K E T P L A C E
Software & data tools for CRE investment management
Helping clients maximize the value of their real estate assets & portfolios through:
ANALYTICS
Independent technology enabled CRE professional services
EXPERT SERVICES
4
UNIQUELY POSITIONED MARKET LEADER
First to Market Advantage
• US online Attribution Analysis
• Voyanta global data management
platform
• Risk analytics
Global Blue Chip Client Base
• Relationships with top 50 CRE
firms
• +4,800 ARGUS Software clients
• 23/24 open-end ODCE funds
use Altus Analytics
• Leveraging Canadian partners
around the globe
Depth and Scale
• 75 offices in all major markets
• RICS global certification
Analytics Standards
• ARGUS DCF global standard
• ARGUS Enterprise +1,300 clients
• Attribution and benchmarking standard
for US open funds
• Data leader in Canada
Depth in Expert Services
• Top 3 largest Property Tax advisors globally
• World renowned Economic Consulting
• Leading provider of valuations & independent research
• Global Cost Consulting expertise
• Market leading Geomatics services in Western Canada
Canadian Partners
Investment Managers
5
ENABLING THE CRE ECONOMY
Analytics Software and
Data
Expert Services Technology enabled Professional Services
Recurring Revenue Sources
• Multi-Year Subscriptions
• Software Maintenance
• Data Properties
Data
Tools
Market Leading Position
$400B assets
#6,000 assets
90,000 users
4,800 clients
1,300 AE clients
70 countries
$140B assets
#7,000 assets
Partnerships
Analytics
6
GROWTH IN ANALYTICS
ANALYTICS
TTM 32% of Total Altus Revenue1
TTM 40.0% YoY Revenue Growth1 (TTM 45.4% recurring
revenue growth)
20% - 30%
Software
1. For the twelve month trailing period ended March 31, 2016 compared to March 31, 2015
2. Excluding the impact of Geomatics, TTM growth was 14.5%
TTM $136.3M in Revenue1 ($TTM 99.1M or 72.7% are recurring)
TTM 68% of Total Altus Revenue1
TTM 1.5% YoY Revenue Growth1, 2
TTM $289.3M in Revenue1
Target Operating Adj.
EBITDA Margin Range:
Target Operating Adj.
EBITDA Margin Range:
High-growth
High-margin
Growing recurring
revenue
Leveraging existing
industry standards
Leading the
emerging global
asset & investment
management market
25% - 35%
Data Solutions
EXPERT SERVICES
15% - 25%
7
GROWING REVENUE IN ANALYTICS
253.8 279.5 290.4
70.6
90.7
126.0 324.4
370.2
416.4
$0
$50
$100
$150
$200
$250
$300
$350
$400
$450
2013 2014 2015
Expert Services Analytics
Re
ve
nu
e (
C$
M)
33.6% 2-yr CAGR in Analytics Revenue
8
49.8
62.6
90.9
25.7%
45.3%
$0.0
$10.0
$20.0
$30.0
$40.0
$50.0
$60.0
$70.0
$80.0
$90.0
$100.0
2013 2014 2015
RECURRING REVENUE GROWTH (in Millions)
Long-Standing Relationships with Top CRE Firms
Re
ve
nu
es
(C$
M)
9
FINANCIAL STRENGTH
*Includes $126M in revolving term facility and $8.2 M convertible debentures
$48.1M cash
flow provided
by operating
activities (net of
$15.1M interest
and taxes paid)
Increasing
recurring
revenue from
global blue chip
client base
Prudent Financial Management
DSO as at Dec.
31, 2015 is 82
days compared
to 86 days as at
Dec 31, 2014
Steady Financial Growth
8.9% 3-Year
Revenue CAGR
7.4% 3-year
Adjusted EBITDA
CAGR
Strategic focus
on Analytics
recurring
revenue growth
– 45.3%
Financial Flexibility
$19.6 cash
position
$134 M term
debt*
1.92x bank
funded debt to
EBITDA ratio
Strong Shareholder Returns
$20.8 M paid in
dividends YTD
Dec. 31, 2015
(including DRIP)
Strong Cash Generation
C O N N E C T I N G T H E G L O B A L R E A L E S T A T E M A R K E T P L A C E T S X : A I F
APPENDIX altusgroup.com For investor inquiries, please contact: Ali Mahdavi
Investor Relations [email protected] 416-234-3660
11
CAPITAL MARKET STATS
SECURITY SYMBOLS TSX: AIF, AIF.DB.A ANALYST COVERAGE
MARKET CAPITALIZATION $796 M
SHARES OUTSTANDING 36.4 M
RECENT SHARE PRICE $21.96
52-WEEK RANGE $22.22 / $16.35
3-MONTH AVG. TRADING VOLUME ~60,000
QUARTERLY DIVIDEND $0.15 per share (~2.7% yield)
ADJUSTED BASIC EPS $0.98 per share (2015)
1. BMO, Stephen MacLeod
2. Canaccord, Yuri Lynk
3. CIBC, Stephanie Price
4. Cormark, Richard Tse
5. GMP, Michael Urlocker
6. RBC, Paul Treiber
7. TD Securities, Daniel Chan
~11% insider & employee ownership
~75% institutionally held
As at May 3, 2016
2013 2014 2015 2016
5.00
10.00
15.00
20.00
25.00
30.00
12
BUSINESS UNIT FINANCIALS
REVENUEC$ (‘000) 2016 2015 % Change 2015 2014 % Change
Altus Analytics 36,684 26,362 39.2% 125,971 90,698 38.9%
Recurring - Data & Software Subscriptions, Maintenance 27,665 19,288 43.4% 90,735 62,420 45.4%
Non-recurring - Licenses and Services 9,019 7,074 27.5% 35,236 28,278 24.6%
Commercial Real Estate Consulting 58,430 53,360 9.5% 224,173 195,037 14.9%
Property Tax 35,747 31,063 15.1% 133,890 98,257 36.3%
Valuation & Cost Advisory 22,683 22,297 1.7% 90,283 96,780 (6.7%)
Geomatics 11,827 18,919 (37.5%) 67,199 85,085 (21.0%)
Intercompany eliminations (252) (176) (43.2%) (930) (618) (50.5%)
Total Revenue 106,688 98,465 8.4% 416,413 370,202 12.5%
ADJUSTED EBITDAC$ (‘000) 2016 2015 % Change 2015 2014 % Change
Altus Analytics 8,807 5,725 53.8% 30,294 25,808 17.4%
Commercial Real Estate Consulting 10,427 8,445 23.5% 38,300 36,620 4.6%
Property Tax 7,941 5,590 42.1% 27,868 21,326 30.7%
Valuation & Cost Advisory 2,486 2,855 (12.9%) 10,432 15,294 (31.8%)
Geomatics (644) 3,225 (120.0%) 10,062 19,240 (47.7%)
Corporate (6,197) (5,207) (19.0%) (15,274) (14,565) (4.9%)
Total Adj. EBITDA 12,393 12,188 1.7% 63,382 67,103 (5.5%)
Three months ended Mar. 31, Twelve months ended Dec. 31,
Three months ended Mar. 31, Twelve months ended Dec. 31,
13
HISTORIC ANNUAL FINANCIALS
Revenue
Adj. EBITDA
Margin
Geomatics
2015
$126.0
$30.3
24.0%
Commercial Real
Estate Consulting Altus Analytics
E X P E R T S E R V I C E S A N A L Y T I C S
YoY
38.9%
17.4%
2015
$67.2
$10.1
15.0%
YoY
-21.0%
-47.7%
2015
$224.2
$38.3
17.1%
YoY
14.9%
4.6%
C$ MM
14
DATA SOLUTIONS GROWTH OPPORTUNITIES
Unified Web Interface
Real Estate Data Warehouse
Asset and Portfolio Modelling Asset and Portfolio Reporting Benchmarking
Workflow Management Risk Analytics 3rd Party Analytics
DataBRIDGE
DataEXCHANGE Lease CRM
Accounting /
Budgeting
Underwriting
Appraisal Management
Property Tax Advisors
3rd Party Data
• Research / Forecasting
• Public Market Pricing
• Industry Associations
Benchmarking, Index
& Attribution Analysis for Funds, Portfolios &
Properties
• See how your assets
stack up in terms of
value, occupancy, rent
and other key
performance drivers
• Gain immediate insights
into which parts of your
portfolio are over- or
underperforming
• Drill down from fund-level
performance and risk to lease-level details
Internal Systems
Opportunities:
• Assets added to the platform & increasing frequency of valuations
• New client types: closed-end funds, pension funds, private equity, debt funds, REITs, etc.
• Global geographic expansion – Europe & Asia (first to market advantage)
• Data sharing partnerships
• New data analytics products (CIO Dashboard)
Risk Scoring
Service Providers
15
ARGUS SOFTWARE GROWTH OPPORTUNITIES
Large, Global Addressable Market Opportunity:
• ARGUS Enterprise (AE) sales – new client wins & DCF client conversions (industry standard)
+4,800 DCF clients
+1,300 AE clients
• Expanded target market through product roadmap enhancements
• Upsell opportunity for add-on sales with more AE modules
• Geographic expansion powered by global CRE companies
Significant market opportunity for new sales in EMEA/Asia
Long-Term Growth Opportunities:
• Transaction processing
• New product & market segments
Property & Portfolio Analysis
• Forecast asset and portfolio performance
• Model scenarios to see the impact of market
changes, tenant events, purchases or sales
• Manage your bottom line with better budgeting and strategic planning
• See the impact of key decisions on property or portfolio level returns
16
EXPERT SERVICES GROWTH OPPORTUNITIES
Property Tax
• Top 3 global property tax advisor
• Deployment of global tax technology platform for benchmarking and client management
• Global presence (Canada, US and UK)
• Consolidation opportunities in US and UK markets
RVA Canada and Global Cost
• Market penetration with ARGUS Enterprise and ARGUS Developer
• Build out of historical valuation and construction cost benchmarking platforms
• Pursuing higher margin engagements in infrastructure
Geomatics
• Diversifying business model across industry segments: right of way, power, municipal and construction
Technology enabled professional services
Pursuing investments in technology to leverage extensive proprietary databases
Uniquely positioned to
serve cross-border clients
Specialists for all major property types
Increasing cross selling with other business units
Leading provider of independent advisory services
Strengthening Each Business Unit to Maintain and Grow Profitability
17
GROWTH AGENDA
►
►
►
18
MANAGEMENT COMMITTEE
Robert Courteau
Chief Executive
Officer
Michael
Commons
Senior Executive
Vice President,
Cost Consulting
North America
Jim
Derbyshire
President,
Property Tax
Global
Colin Johnston
President,
Research,
Valuation &
Advisory
Canada
Dave
Gurnsey
President,
Geomatics
Niall
McSweeney
Senior Director,
Cost Consulting
Asia Pacific
Alex Probyn
President,
Property Tax
UK
Angelo
Bartolini
Chief
Financial
Officer
Liana Turrin
General
Counsel and
Corporate
Secretary
Terry Bishop
President,
Property Tax
Canada
19
BOARD OF DIRECTORS
RAYMOND MIKULICH, CHAIRMAN Mr. Mikulich currently serves as the Managing Partner and Chief Investment Officer for Ridgeline Capital Group, LLC,
a real estate investment and asset management company, and the Chief Executive Officer of HomeLPC, LLC, a real
estate investment company based in New York, NY. He was head of Apollo Global Real Estate North America. Mr.
Mikulich was a member of the investment committee and the co-head of the Real Estate Private Equity Group of
Lehman Brothers and the Group Head of Global Real Estate Investment Banking at Lehman Brothers. He has served
as a Trustee of the Urban Land Institute, on the Board of The Real Estate Roundtable, as a member of the Advisory
Board of the National Association of Real Estate Investment Trusts (NAREIT) as well as numerous other industry
organizations.
ROBERT COURTEAU, CEO Mr. Courteau is the Chief Executive Officer of Altus Group. Prior to joining Altus Group, Mr. Courteau was President,
North America, of SAP AG, a global market leader in enterprise application software, with other previous roles,
including Chief Operating Officer of its Global Customer Operations. Prior to that, Mr. Courteau served as an
Executive Vice President for EDS Corporation. He has been an active board member of numerous North American
not-for-profit organizations and has served on boards of several publicly-traded companies. On January 24, 2013, Mr.
Courteau was appointed a director of Real Matters Inc. He holds a Bachelor of Commerce degree from Concordia
University and was awarded an Honorary Doctor of Laws degree from Concordia University in 2011.
CARL FARRELL Mr. Farrell is the Executive Vice President & Chief Revenue Officer for SAS Institute, the leader in business analytics
software and the largest independent vendor in the business intelligence market. Mr. Farrell has over 30 years of
global experience in the software and related services industry and has held executive positions at Vignette
Corporation, Idiom Technologies, JD Edwards and JBA Plc.
20
BOARD OF DIRECTORS
DIANE MacDIARMID Diane MacDiarmid is President, MacDiarmid & Company, a strategy and organizational effectiveness consulting
firm. Previously Diane was Executive Vice President, Corporate Resources with Bentall Kennedy LP, a North
American real estate investment and services company. Prior to joining Bentall Kennedy, Diane was President of
Oliver Wyman Delta Canada. Earlier in her career Diane worked in financial services, consulting engineering and
the oil industry. Diane holds a Master of Business Administration from the Schulich School, York University, Toronto
and a Bachelor of Applied Science (Civil Engineering) from Queen’s University, Kingston, Ontario. She is a member
of the boards of Morneau Shepell and Altus Group and is past chair of the board of AMREF (African Medical and
Research Foundation) Canada.
TONY GAFFNEY Mr. Gaffney was formerly Chief Executive Officer of Aon Hewitt Canada, a human capital and management
consulting company. Previously, he was Managing Partner, Toronto, of Accenture Inc. Mr. Gaffney has served as
President and Chief Executive Officer of BCE Emergis, a publicly-traded company, and Bell Nexxia. Mr. Gaffney
has also held international leadership positions with SHL Systemhouse Inc. and MCI Corp. He currently sits on the
boards of President’s Choice Bank, Canada’s Walk of Fame and Bishop Strachan School. Mr. Gaffney holds a
Bachelor of Engineering (B.A.I) degree and M.A. from Trinity College in Dublin, Ireland. He is also a graduate of
the Rotman Corporate Directors program (ICD.D).
ERIC W. SLAVENS Mr. Slavens currently serves on the boards of NexGen Financial Corporation, an asset management company, Effort
Trust Company, a financial services, real estate and asset management company, and Titanium Corporation Inc., an
oil sands services and technology company. He is a Fellow of the Chartered Professional Accountants of Ontario. Mr.
Slavens was a partner of PricewaterhouseCoopers LLP for 30 years, serving most recently as the National Leader, IPO
Services. Mr. Slavens has a Bachelor of Commerce from the University of Toronto and is a graduate of the Directors’
Education Program co-sponsored by Rotman School of Management and the Institute of Corporate Directors.
21
BOARD OF DIRECTORS
A.B. (SANDY) McARTHUR Mr. McArthur is the Consultant to the President of Morrison Hershfield. His past appointments include Chairman of
Morrison Hershfield, President and Chairman of Fluor Daniel Canada, Senior Vice President and General
Manager, Chemicals and Petroleum Business Unit, of SNC-Lavalin, and President of SNC-Lavalin Trinidad Ltd.,
West Indies.
JANET WOODRUFF Ms. Woodruff is an experienced corporate director and senior executive with over 30 years of business
experience in the energy, transportation and health sectors, including her most recent role as acting Chief
Executive Officer of Transportation Investment Corporation, a B.C. Crown Corporation. Ms. Woodruff currently
serves on the boards and audit committees of Capstone Infrastructure Corporation and FortisBC Inc. Ms.
Woodruff is a member of the Institute of Corporate Directors, holding the ICD.D designation, and is a Fellow
Chartered Accountant of British Columbia. She earned her Honours Bachelor of Science from the University of
Western Ontario and her Master of Business Administration degree from York University.
ANGELA BROWN Ms. Brown is an experienced executive with more than 25 years in the payments industry, including merchant
acquiring, consumer and commercial payment products, payment processing and merchant acceptance. Ms.
Brown currently serves as President and Chief Executive Officer of Moneris Solutions Corporation. Prior to joining
Moneris, Ms. Brown was Group Executive, Enterprise Development, Merchants & Acceptance, for MasterCard
Worldwide. She was responsible for cultivating MasterCard’s relationship with merchants, creating new merchant
value propositions and expanding the reach of MasterCard’s network. Previously, Ms. Brown spent 13 years at the
Canadian Imperial Bank of Commerce within the ATM and Cards divisions. Ms. Brown graduated with a Master’s
degree in Business Administration from the Schulich School of Business at York University in Toronto.
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