TORONTO, Sept. 9, 2016 /CNW/ - BrightPath Early Learning
Inc. ("BrightPath" or the "Company") (TSX-V: BPE), a leading
Canadian provider of high-quality, comprehensive early childhood
education and care, announced today it has closed its
transformative acquisition of 20 Peekaboo child care centres
located in the Greater Toronto
Area. This acquisition was first announced on June 28, 2016.
Peekaboo Acquisition Highlights:
(All amounts are in Canadian currency)
- The purchase price was $22.0
million of which $19.2 million
was released at closing;
- BrightPath financed the acquisition entirely through its credit
facility, which was recently increased to $62.5 million on the strength of the Company's
operations and the value of its corporate owned real estate
portfolio;
- The acquisition is expected to be highly accretive to the
Company's Funds From Operations ("FFO") per common share reflecting
Peekaboo's profitable operations;
- The Peekaboo centres, based on historical metrics, generate
approximately $3.0 million in
incremental FFO annually, net of interest costs related to
financing the transaction from the Company's credit facility;
- The agreement with Peekaboo's vendors includes financial
holdbacks totaling $2.8 million that
may be released upon successful completion of various milestones
over the next 36 months, including revenue metrics and amounts in
respect of vendors' representations and warranties;
- The transaction increases the number of facilities in
Ontario from 15 to 35, and
increases the Company's total number of licensed spaces by 40% from
approximately 6,100 to 8,600;
- With the addition of 20 Peekaboo centres, Ontario is now BrightPath's largest market,
representing 46% of the Company's total capacity across
Canada versus 25% previously.
Alberta-based licensed spaces now
represent 45% of the portfolio, the remainder being in British Columbia
- The Peekaboo centres are located in the Regions of Peel and
Halton, two of the largest and fastest growing communities within
the Greater Toronto Area;
- The acquired Peekaboo business holds franchise agreements with
11 affiliate centres, providing BrightPath with a new revenue
stream and potential near-term additional growth opportunities;
and
- The close of the Peekaboo acquisition follows the recent
purchase of The Lawrence Park School Ltd. in Toronto, which added 95 licensed spaces to the
Company's portfolio and was announced on July 26, 2016.
"The close of the Peekaboo acquisition represents our most
significant growth milestone to date and is transformative on a
number of levels," said Mary Ann
Curran, Chief Executive Officer of BrightPath. "Most
significantly, it adds considerable scale to our existing platform
in a market that shows signs of increasing strength. We believe
there is opportunity to further enhance the Peekaboo brand with
BrightPath's high-quality child development and care programs.
Furthermore, as the transaction was completed without equity
dilution, it will deliver highly accretive pro forma cash flow
growth for our shareholders."
Ms. Curran added, "We welcome Peekaboo staff and families, and
look forward to optimizing the combined Company's technology, other
resources and best practices to improve operations while providing
premium quality early childhood education and care to the children
entrusted to us."
NON- IFRS PERFORMANCE MEASURES
The Company uses FFO as an indicator of financial performance.
FFO is calculated by adjusting net profit (loss) to add back
acquisition costs expensed as incurred, depreciation and certain
other non-cash items.
FFO does not have a standardized meaning prescribed by IFRS. The
Company's method of calculating FFO may be different from other
entities and, accordingly, may not be comparable to such other
entities. FFO does not represent cash flow from operating
activities as defined by IFRS, is not indicative of cash available
to fund all liquidity requirements, including capital for growth,
and is not to be considered as an alternative to IFRS-based net
profit (loss) for the purpose of evaluating operating
performance.
ABOUT BRIGHTPATH EARLY LEARNING INC.
BrightPath Early Learning Inc. is a Canadian leader in child
care and early education with 76 locations in major markets across
the country. Meeting the highest standards in curriculum,
nutrition, technology and recreational programming, BrightPath is
committed to providing families with the very best child
development and care Canada has to
offer.
For more information, visit www.BrightPathKids.com/corporate or
contact Dale Kearns, President &
Chief Financial Officer of BrightPath Early Learning Inc. at (403)
705-0362 ext. 406.
Neither TSX Venture Exchange nor its Regulation Services
Provider (as that term is defined in policies of the TSX Venture
Exchange) accepts responsibility for the adequacy or accuracy of
this release.
FORWARD-LOOKING STATEMENTS
Certain statements contained herein constitute forward-looking
statements regarding the future growth, results of operations,
performance and opportunities of the Company. In particular, this
news release contains forward-looking statements with respect to
the accretive nature of the Peekaboo acquisition and the FFO
anticipated to be generated by the assets acquired pursuant to the
Peekaboo acquisition. Forward-looking statements can generally be
identified by the use of, but not limited to, the following words:
"plans", "expects" or "does not expect", "budget", "scheduled",
"estimate", "forecast", "pro forma", "anticipate" or "does not
anticipate", "believe", "intend", "inferred", "potential" and
similar expressions or statements that certain actions, events or
results "may", "could", "should", "would", "might" or "will" be
taken, occur or be achieved. Forward-looking statements are not
historical facts, but reflect the Company's current expectations
regarding future results or events based on information currently
available and what the Company believes to be reasonable
assumptions. All forward-looking statements are qualified by these
cautionary statements.
Forward-looking statements are subject to a number of risks,
assumptions and uncertainties that could cause actual results,
performance or events to differ materially from those expressed or
implied by such forward-looking statements. Factors that could
cause actual results or events to differ materially from those
expressed, implied or projected include, but are not limited to,
general economic conditions, the Company's ability to meet and
maintain forecasted occupancy levels, general government policies,
continued availability of government child care subsidies to
parents, unexpected costs or liabilities related to acquisitions,
construction, environmental matters, legal matters, changes in
interest rates, credit spreads and the availability of financing.
In addition, please refer to the Risks and Uncertainties section of
the Company's annual Management's Discussion and Analysis. As such,
the Company gives no assurance that actual results will be
consistent with these forward-looking statements.
Readers should not place undue reliance on any such
forward-looking statements. These forward-looking statements are
made as of the date hereof. The Company undertakes no obligation to
publicly update or revise any such statement, reflect new
information or reflect the occurrence of future events or
circumstances, except as required by securities laws.
SOURCE BrightPath Early Learning Inc.