Altus Group Limited

Thank you, Mike. Good afternoon, everyone, and welcome to Altus Group's Q3 2014 results conference call and webcast for the period ended September 30, 2014.

For reference, our Q3 results news release was issued about an hour ago and it's posted on our website, along with our MD&A and financial statements. Please visit altusgroup.com to obtain these documents and for more information.

We will begin today with an overview of our performance during the quarter, including a discussion of our financial results and noteworthy developments. We will finish by taking questions from analysts and institutional investors.

Joining us today is our Chief Executive Officer, Bob Courteau; and our Chief Financial Officer, Angelo Bartolini. Before we get started, please be advised that some of our statements today may contain forward-looking information.

Various factors and assumptions were applied or taken into consideration in arriving at these forward-looking statements that do not take into account the effect of events announced today. There are also numerous risks and uncertainties that could cause actual results to differ materially from those set out or implied by such statements.

The factors, assumptions, risks and uncertainties that may be relevant to these differences are described in the company's filings on SEDAR. Our comments and answers to any questions must also be considered in the context of the disclosure in these materials.

I'll now turn the call over to our CEO, Bob Courteau.

Thank you, Camilla, and thanks to all of you for joining us this afternoon. I'll start off today with some top line insights into our performance and then provide an update on how we delivered against our growth strategy during the quarter.

Then I'll get Angelo to go over our financial performance in more detail and then return to speak about the outlook for our business.

As you'll hear today, our organic growth initiatives, acquisitions and ongoing focus on strengthening our operational execution continue to deliver strong financial performance during the third quarter. Our 15% increase in gross revenue and 19% increase in adjusted EBITDA marks the fourth consecutive quarter of double-digit year-over-year growth.

In addition to these financial milestones, we laid a lot of groundwork for our long-term growth strategy establishing a foundation for continuing growth into 2015. Our ability to sustain earnings growth and healthy EBITDA margins while continuing to make investments for the future reflect the strong execution of our team and over 2,300 employees, and speaks to the strength of our strategy.

As you know, our growth strategy prioritize the following 3 strategic initiatives, against which we made tremendous progress this year and this quarter. First, we set out to grow our capabilities to serve the global asset and investment management market to call GAIM.

Secondly, we focused our efforts on U.S. expansion, and we've also made additional investments in Europe.

And third, we focused on strengthening each business unit to grow profitably. We have opportunities in virtually every one of our businesses, and in Canada, a strong ability to continue to be the market share leader in each of the markets that we serve.

We expect that the execution of the strategy will ultimately yield strong results for both our top and bottom line performance, creating value for our stakeholders while addressing the changing needs of our clients and the new industry trends that compel us to be innovative with our offerings.

To recall some of our recent operating highlights in more detail, we're seeing increased traction from our strategic initiatives, aimed at enhancing our data and software products and increasing our market share in Europe with our GAIM business. During the third quarter, ARGUS benefited from an increasing proportion of its sales coming over the European market, signing one of the biggest contracts in ARGUS history.

And as a testament to the quality of RVA's new offering in Europe, we recently signed 2 new clients in London and Luxembourg. Our European expansion supports the needs of our increasingly global client base, specifically in the global asset and investment management market that we serve.

Our global RVA business unit continues to perform well during this growth phase. And as we highlight in our press release, we're making good progress, executing on its multifaceted strategy to enhance its data offering and export its unsourced appraisal model or the business process outsourcing model to Europe.

To better serve our RVA clients with data products, we recently made 2 strategic acquisitions that further our plans of broadening our data offerings, RealNet in Q3 and Voyanta in October. Both businesses were strategic to us not only for current product enhancements, but also have significant long-term importance to the company's product roadmap.

Although still early stage, these acquisitions put us a step closer to our longer-term goal of building at a commercial real estate data model. Moreover, the integration of RealNet and Voyanta under the Altus banner also offers them a number of synergistic benefits and supports their respective sales efforts.

Both also provide us with additional revenue streams.

As we saw in Q3, RealNet was a key contributor of RVA's revenue and earnings growth. Similarly, Voyanta will operate as the standalone business and that will create a new cloud-based revenue stream while increasing our suite of offerings for both RVA and ARGUS.

In Canada, RealNet and Altus InSite have partnered to promote our combined strength in the Canadian market analysis, showing clients how Altus InSite's national, information on inventory, vacancy and new supply, will be complemented by RealNet sales data. RealNet's President, George Carras; and Altus InSite's President, Sandy McNair, recently co-hosted a presentation out west on the activity, risks and opportunities in the Vancouver market.

Clients in attendance were given a demonstration of product integration synergies already in the development phase, showcasing office leasing, investment sales and for-sale listing data, all shown together on RealNet's mapping platform. Client response has been very positive, and we're continuing to expedite client sector innovation for the combination of these important data sets and tools.

In the U.S., Voyanta provides us with the data management capability to revamp our existing DataBridge benchmarking application onto a single analytics platform with more functionality. It also gives us a foundation to build out our data offerings for our European clients.

This new analytics platform will further be strengthened with substantially more data, which we have recently secured through a data-sharing agreement with NCREIF, the U.S.-based National Council of Real Estate Investment Fiduciaries.

Basically, through this arrangement, NCREIF's aggregated performance data which currently powers several quarterly indices, and Altus Group's valuation information will be combined in a web-based application that will enable users to perform investment analytics, including fund level return contribution and property level attribution and analysis. This new powerful attribution product is the first of its kind in the industry, which we plan to eventually expand internationally beyond its current U.S.

market, and to integrate with ARGUS. Data-sharing partnerships will also be sought to support this initiative.

The collaboration with NCREIF is a strategic one. The new data that we'll provide will allow portfolio managers to benchmark against indices, the industry and other competitive portfolio, something that's never been done before.

This will add significant value to their investment decisions and how they manage their real estate portfolios.

Consequently, we can expect that this will lead to them adding more assets on our platform and should also attract new clients. And over time, this kind of insight will also be of a lot of value to closed funds and to other private equity players, including debt funds.

I also wanted to spend a minute to highlight the European opportunity for our BPO RVA model, the Appraisal Management model, and how regulatory changes have created a unique opportunity for us. By way of background, recent changes to national law in a number of EU countries will have a significant impact on the alternate investment fund industry that we target with our outsourced RVA business.

Under the new legislation, the Alternative Investment Fund Manager Directive, or AIFMD, fund managers must now follow a very extensive set of measures and technical rules that will ultimately require increasing independence and transparency around their valuation risk and portfolio management. This is where we fit in with our independent BPO model.

And this is why we open an office in Luxembourg this year, to position ourselves early as this leader -- as the leader for this highly attractive market opportunity. Luxembourg is at the center of gravity for the commercial real estate investment industry in Europe.

In fact, the growth in the number of real estate investment vehicles set up in Luxembourg has outpaced the European average, making it one of the best locations for real estate funds and for us to be in. Our independent BPO RVA model is perfectly positioned to meet the needs of the European market, where we offer AIFMD-compliant and best practice services that satisfy the needs of both the fund manager and the regulator.

And as a testament to that, we're pleased to announce that we recently signed up our first 2 European asset management clients, industry heavyweights, TIAA-CREF and AIG. We're off and running and there's growing demand for our services in Europe.

At ARGUS, the ARGUS Enterprise sales momentum remains strong, as validated by strong license growth and today's announcement that we reached a 400 corporate client milestone. To put this in perspective, we doubled from 200 in April this year, a true reflection of AE's growing acceptance in the industry.

The strength of ARGUS Enterprise adoption rate is twofold, the new client wins such as what we experienced in Europe and from conversions from our current client base of over 4,000 corporate clients who collectively represent tens and thousands of users. This has been driving 7 straight quarters, a plus-20% revenue growth on an organic platform, and that is very compelling.

Recent enhancements to ARGUS Enterprise have now no doubt played a key role in expanding our target market internationally. Our latest version of ARGUS Enterprise 10.5 has enhanced benchmarking functionality and now incorporates the world's most widely used standard valuation methodologies, offering clients a unified and consistent solution, whether they've invested in Toronto, the United Kingdom or in Sydney.

It's a huge draw, especially for our global clients, who are driving the significant market adoption onto others in their ecosystem, increasingly requesting the real estate files to be in the ARGUS format.

ARGUS truly is the currency for how this industry transacts today and will transact on a global basis. As I mentioned during the quarter, we were successful in signing one of the largest owner operators in the United Kingdom, SEGRO, and this contract is one of the largest in ARGUS history and certainly the largest in Europe.

A substantial 6-figure contract going after the biggest contract has been a key focus for our sales force. And I'm seeing -- I'm really pleased to see a positive trend starting to emerge in that regard.

I'll just say we had a great quarter on our efforts to serve the global asset investment management market. In summary, we added global functionality for ARGUS Enterprise and signed one of Europe's largest owner operators as a client.

We advanced our DataBridge revamp. We furthered our data offerings through the acquisition of RealNet and Voyanta.

We got Luxembourg off the ground including landing our first 2 European clients and we signed a very important data sharing agreement with NCREIF.

So moving onto Property Tax. Our North American practice had stable performance in the quarter coming off a great Q2 and increased revenue in the U.S.

operations during the quarter. In the U.K., revenue was higher due to the increased settlement of tax cases and improvement in exchange rates.

They did a great job. On the back of an exceptionally strong Q2 and tax, there was an element of seasonality to our Q3 performance in North America.

In Q2, we saw modest top line growth and some compression in EBITDA margins. But following that strong Q2 performance, we're still up year-to-date, 19% in revenue and 26% percentage growth in adjusted EBITDA on a year-to-date basis.

In the U.K., the team is doing amazing work and continue to innovate, and they delivered double-digit growth in Q3. When you factor in the favorable 13% foreign exchange lift from our U.K.

operation, you can see the benefits of having a truly global business model. We remain committed to expanding our services in the U.S., where our motto [ph] is uniquely leveraged as one of the few company that's quick to service, large multinational cross-border clients.

The U.S. market still represents a very attractive growth opportunity for us and an opportunity we have positioned our business for, both through organic investments and by evaluating acquisition opportunities.

In our core cost business, we enjoyed another quarter of improved earnings, both in North America and in Asia Pacific. The group continues to be innovative and win a number of high-profile new assignments that reinforce our industry expertise.

As you know, our North American cost group is strongly correlated to the construction and development market. And although we have capabilities all across Canada, a large part of their revenue was still predominantly concentrated in Ontario and here in Toronto, and through the multi-residential condo market for our project monitoring service.

Our strength in this market stems from our strong relationship with financial institutions, developers and government entities, and also by leveraging various relationships from our other business units. We are the market leader in Toronto and we're poised to benefit from the continuing growth in this city.

High-rise residential sales are higher than during the same period last year and significant infrastructure investments in the transportation sector are now moving forward. To rush the complete facilities for the 2015 Pan Am Games in Toronto is also evident.

If you look at Toronto's skyline today, you'll see multiple cranes across the city. Beyond the Toronto market, we've also been focused on expanding our services in other Canadian cities and in the U.S., especially in the P3 infrastructure market, where we've developed a particular strength.

A few examples, 2 notable contracts in the U.S. in Indianapolis and in Denver.

In Indianapolis, we're acting as the lender's technical advisor for a substantial design build finance maintain project. And in Denver, we're providing technical advisory services for Colorado's Department of Transportation P3 highway replacement project.

And we also had some very important noteworthy wins in Alberta recently, where we're providing technical advisory services for the expansion of a substantial urban line in Edmonton. And we are providing cost planning services for a new wing extension at the University of Lethbridge.

I told you, last year, we were making Alberta a focus of our efforts, and we're seeing the bookings that come with that now.

And finally, our Geomatics business had another great quarter. They performed extremely well, delivering double-digit growth in the third quarter.

We are very proud of this team. The 23% revenue growth and 35% adjusted EBITDA growth is predominantly attributed to the strong performance of our integration of Maltais, which better position the business to optimize crew utilization and broadness service offering into the electric power and industrial sectors.

Our team worked very hard on these efforts. A key highlight from the quarter was winning our first major construction contract.

We were awarded the QA/QC survey contracted by for Canada for 3 segments of the Greenfield Refinery being constructed at Redwater near Edmonton. Another noteworthy project is the QC survey for the Walterdale Bridge project in Edmonton.

Interesting, this bridge is being fabricated in Korea, and our people travel to create, to take measurements to ensure that the bridge components are being constructed to the required specification.

Look, overall, I'm very pleased with the company's performance in the third quarter. And as you're going to hear from Angelo shortly, our results were in line with their anticipated trajectory for every one of our business units.

These results reflected the strategic decisions we made last year to strengthen our operations and demonstrate our ability to deliver strong operating results on an organic growth platform while continuing to make long-term investments.

I'll return to comment on the market element in a few minutes, but let's first have Angelo take a deep dive on the numbers.

Thank you, Bob. We're pleased to report on another quarter of sustained double-digit growth and overall strong financial performance.

As you heard today, we had a very productive quarter and accomplished a number of corporate milestones that will have longer term benefits to our top and bottom line performance. The combination of organic growth initiatives, investments and strategic acquisitions fueled our year-over-year growth during the third quarter and helped position the business for continued growth into 2015.

There were several milestones in particular that contributed to strong performance in Q3, which I'd like to highlight. First, adding European valuation standards to ARGUS Enterprise during the second quarter really opened up the European market for ARGUS in Q3.

This drove increased license sales out of Europe, and as Bob mentioned, helped land some big global accounts. Secondly, RealNet, which we purchased early in the quarter, provided strong returns for our RVA group.

RealNet not only fit our strategic criteria for broadening our data offerings, but it also was a key contributor to RVA's growth during the quarter.

Third, we strengthened our balance sheet by redeeming $48 million of our 5.75% convertible debentures that were in the money. This not only improved our financial leverage metrics, but also resulted in cash savings to the company that would have otherwise been incurred in higher future interest payments.

Fourth, we made progress against our strategy of expanding our footprint geographically, RVA and ARGUS in Europe and tax in the U.S. And as a testament to that, we saw some new client wins in those markets and are now seeing overall, more revenue contribution coming from outside of Canada, which also allowed us to benefit from favorable exchange rates.

And lastly, our ongoing focus on operational execution in strengthening each business unit is being reflected in both the top and bottom line at all our business units. With that as a backdrop, I will now cover our financial performance for the third quarter ended September 30, 2014 compared to the third quarter in 2013.

Gross revenues increased 15% to $92.3 million, of which acquisitions contributed approximately 7% to revenue growth in Q3. Globally, we also benefited from favorable FX rates, which impacted revenues by 2.3%.

Adjusted EBITDA increased by 19% to $17.4 million, driven by both increased revenues and higher operational efficiencies in several of our business segments. Moreover, we've been able to sustain healthy EBITDA margins while making investments.

Our quarterly EBITDA margin stands at nearly 19% and 18% on a year-to-date basis. Adjusted earnings were $9.3 million compared to $7 million.

And on a per-share basis, adjusted basic EPS was $0.30, same as last year. Moving onto more details update on our business units, I'll start off with 2 of higher-margin global businesses, which we have brought close together to better serve the highly lucrative Global Asset and Investment Management market or as we refer to them under the acronym of GAIM focused businesses.

In the third quarter, global RVA achieved gross revenues of $22.8 million, up 25% from last year. Our July acquisition of RealNet contributed 8% of the growth.

Other contributing factors included in the U.S., we benefited from new client wins as well as from improvement in the exchange rate against the Canadian dollar, about a 2% impact. And in Canada, we had growth in advisory services such as Right-of-Way, property disputes and economic advisory related to the multi-residential sector as well as the big advisory contract in the Middle East.

Growth investments in support of our European expansion and technology enhancements were reflected in our reported adjusted EBITDA of $5.3 million for the quarter, which increased by about 9% from the previous year largely due to RealNet's contribution. EBITDA margin in Q3 was 23%.

As we highlighted in the press release, ongoing investments in 2015 will be required to further execute on RVA's global strategy. To name a few examples of our ongoing investments, first, Voyanta will require additional investments into 2015 before it's cash flow positive on a standalone basis; second, we're building a new attribution product with NCREIF data; and third, we'll need to staff -- add staff resources to our European expansion as we win more clients.

ARGUS Software delivered another strong quarter of year-over-year growth. A combination of strong license sales, growing maintenance fees and favorable exchange rates contributed to growth in Q3.

Gross revenue totaled $11.5 million, up 22%; adjusted EBITDA was $3.1 million, up 6%; and quarterly EBITDA margin was 27%, which primarily reflects higher commissions from strong license sales and additional investments from Europe and Asia. Additionally, the favorable currency moves benefited ARGUS revenues by 6% and adjusted EBITDA by 5%.

Also, worth highlighting, we capitalized approximately $300,000 of costs related to the software development for our latest release of AE 10.5, which through the incorporation of Australian valuation standards now encompasses global functionality.

Moving on to our other business units, North America Property Tax continues to benefit from growing momentum in the U.S., where we have been investing for growth. Our business model is uniquely leveraged as one of the few companies that's equipped to service large, multinational cross-bordered clients, and we are pressing that advantage.

Gross revenue in Q3 was $16.1 million, up modestly from last year as a result of organic growth, both in Canada and in the U.S. Adjusted EBITDA was $3.3 million, down 21% during the quarter, due to our investments; and our quarterly EBITDA margin, a quarterly drop 20%.

As Bob mentioned, following an exceptionally strong second quarter, there was an element of seasonality in Q3. Year-to-date, however, the North America Tax business is still ahead, up 19% in revenue and 26% in adjusted EBITDA.

Beyond North America, our U.K. Property Tax group had double-digit year-over-year growth, benefiting from higher closure of cases for tax ratings and empty rate cases as well as from favorable exchange rate improvements, which benefited gross revenue by 13%.

U.K. gross revenue was $6.3 million, up 23%; adjusted EBITDA was $1.6 million, improved by 80%; and EBITDA margin in Q3 was 25%.

The overall performance from tax reflects the benefit of having a global business and helps smooth out our performance over the varying cycles. In Geomatics, both organic and acquisitive investments drove growth.

Gross revenue was $23.7 million, up 23% overall from last year; adjusted EBITDA was $7 million, up 35%; and EBITDA margin in Q3 increased to 30%. The year-over-year growth is predominantly attributed to the strong performance from MGI, which better positioned us to optimize true utilization and broaden our service offering into electric power and industrial segments.

In our cost practices, we continue to see positive trends and improving earnings and margins. The business continues to rationalize while we make investments for future growth.

In North America, gross revenue was $7.1 million and adjusted EBITDA was $1.7 million, up 5%; EBITDA margin in Q3 was 23%. In Asia Pacific, gross revenue was slightly down by 4% year-over-year to $4.8 million, while adjusted EBITDA improved by $900,000, and EBITDA margins improved to 19%.

Our corporate cost during the quarter increased slightly to $5.5 million compared to $5.1 million last year largely due to higher accrual of variable compensation, due to improved performance in the business as well as additional professional fees related to various corporate initiatives. Employee compensation for Q3 was $54.6 million, up 17% or $7.9 million, from $46.7 million in the same period 2013, which reflects investments in organic growth initiatives and acquisitions as well as higher accrual of variable comp due to improved performance.

Our annual discretionary bonus program, which was modified in 2013, and which comprises of a combination of cash and equity, has proven to be a strong contributor among other important HR initiatives in building stronger, long-term employee engagements. I'm pleased to highlight that our direct employee ownership is around 14%.

Turning to our financial position, as at the end of the quarter, our cash flows and balance sheet remain strong and stable, giving us the financial flexibility to pursue organic investments and acquisition opportunities. As at September 30, 2014, the company had $17 million in cash, revolving term facility stood at $87 million and $72.7 million of available borrowing room.

Our current bank covenant, a funded debt-to-EBITDA, stands at 1.24x, which is still well below our limit of 2.75. With that, I would now like to turn things back over to Bob to cover the outlook.

Thank you, Angelo. I'll open the line a couple of minutes for questions, but some comments on the outlook for our business and where we believe growth will come from over the next few quarters.

As we near the end of the year, I reflect back on this year's activities, I'm pleased to report that everything we set out to accomplish in 2014 has resulted in an improved financial performance, and perhaps more importantly, contributed to our long-term growth endeavors. Our focus on growing Altus Group along with their operational rigor to strengthen each of our business units is driving results and delivering on our commitment to build shareholder value.

Just looking back at the year, we sustained double-digit growth every quarter this year in our key metrics, revenue and adjusted EBITDA. Year-to-date, for the 9-month period, gross revenue's up 15% and adjusted EBITDA is up 19% on a year-over-year basis.

While continuing to make investments, we've been able to sustain earnings growth and maintaining healthy EBITDA margins around 18% this year. Through both organic initiatives and strategic acquisitions completed during the year, we're now more geographically diversified with growing market share and increasing revenue contribution from the U.S.

and Europe. We have a broader global customer base serving some of the world's largest real estate companies, who are actively endorsing our established industry standards with ARGUS and RVA.

We enhanced our advisory services in software and data solutions with new business lines, add to that expertise, expertise and through upgrades of our existing offerings. And as we demonstrated through our recent acquisitions of RealNet and Voyanta, we started to build the foundation for longer-term growth stemming from the very attractive and lucrative opportunities in big data.

The strong performance to-date is very encouraging. And while certain drivers were tied to the stronger cycle, we remain optimistic about the compelling growth momentum felt by virtually all of our business units.

With the demand for our services, both strong and stable, we maintain an optimistic outlook going into 2015, as we believe our business fundamentals for each of our segments are strong.

At Geomatics, in light of the recent weakness in oil prices, we are monitoring capital spending from the oil and gas sector very closely as this sector currently accounts for approximately 65% of our Geomatics revenues. At this stage, it would be prudent to acknowledge that the oil price decline could impact demand for Geomatics services from this sector.

However, we feel we're better positioned to mitigate downside risk as we've taken steps to enhance crew utilization and diversify our services across our segments, such as Right-of-Way, power, municipal and construction. And we really like the performance of the business right now.

At cost, Toronto represents a key market for our North American group. And based on recent statistics, high-rise building construction is picking up again and remains one of the busiest cities in the North American universe.

Beyond Toronto, we're enhancing our exposure geographically to Western and Eastern Canada as well as the U.S., and we remain focused on pursuing higher margin engagements.

As demonstrated by our improved earnings, we're also finding our footing in Asia Pacific. Being in Asia, it continues to have a strategic importance to us, and we're committed to our long-term plan of establishing our presence there by building upon our current operations.

We plan to put additional efforts on bringing our Canadian and U.S. clients to Asia.

And this will serve to further meet our goals for global expansion while creating near-term opportunities for all of our business units, including ARGUS who's recent addition of Australian Valuation to ARGUS Enterprise, will see them more active in that market. We see North American Property Tax as another growth area for our business, particularly in the U.S., where we're still in an early phase of expansion.

Investments made in the U.S. are showing positive returns, and continuing to expand there will remain a key focus of our growth.

The U.S. market is still largely fragmented and offers great opportunities for consolidation.

In the U.K., we expect that the business will improve its top line performance through expansion of its services, and we'll continue to be the innovation leader in serving that market as we enter into the fifth year of the extended 7-year tax assessment cycle in the U.K.

new client wins and additional conversions to ARGUS Enterprise from our current DCF installed base; product enhancements and new offerings that will provide us with the opportunity to drive increased license sales for our current and new customers; and geographic expansion into new markets, specifically Europe and Asia, to globalize our industry standard platform. To build for the future and to support our current pace of our growth at ARGUS, we plan to continue investing in areas such as product development, professional talent, marketing and enhancing our global presence.

This may translate into some short-term variability in our margins, but we are focused on the long term, and we'll continue to invest proportionately with our strategy to grow this business.

And with that, I'd like to open questions. I apologize for the length of our comments, but it was quite an impressive quarter, both in terms of the headlines, but also the results that we wanted to fully give you a debrief on what we were able to accomplish.

So I'd like to open it up for questions.

So I don't know where to start, lots of details thrown at us. Just on the ARGUS, the announcement of the clients going from 200 to 400 since April, how would you characterize the increase in actual licenses over that time?

Yes, we're starting to see, as we have rolled out ARGUS Enterprise, is a multipronged opportunity, right? And it's clear, with 400 customers to get tools, as you guys all along, a large part of this is really declared to the market that we're being positioned as an industry standard, as a global basis, right?

So what you're seeing is revenue coming from, as I said earlier, continuing to upgrade our DCF clients in the U.S., but we're adding a lot more new clients. On top of that, we're seeing unit pickup from customers that have decided to go on the ARGUS Enterprise platform are now going back and buying more users to support other parts of their operation.

So you're seeing a number of deals where they might have started in the U.S. and now they're adding European or Asian users and Australia for that matter.

And finally, we've got a strong product pipeline. So we've got a full suite there we're going after.

So the cool thing about this is that we're clearly adding lots of clients, but the revenue is now starting to come in multiple ways, same client growth, DCF expansion, new customer opportunities and, frankly, even going into new markets.

Okay, all right. I still don't know what the licenses did over that time, but I guess I'll take my best guess.

Can you give us any color as to the breakdown of ARGUS's revenue either for the quarter or on a year-to-date basis between license revenue and maintenance and maybe just some color on how the maintenance portion is growing?

We haven't broken that out historically, and I can carry your frustration, and we definitely are fueling our growth here into now on license growth, right, in the flow-through of their maintenance, but we're also seeing increased demand on the services front. And so this is a story where we're seeing effective improvements across all of our revenue.

But license on the top line is growing faster than the overall revenue as one indicater of performance.

Right, yes, that makes sense. Okay.

And last one before I turn it over, just on the Geomatics, I mean, it was a great quarter. The margin was the highest I've seen in a number of years.

Anything in there? Was Maltais a higher-margin business or was there just something in there that kind of boosted it?

Well, I think I've told you guys in previous quarters that one of the benefits of Maltais is that we have better coverage, right? So we can actually -- as we get business, because we have broader coverage, we're in a couple of different market, we had really, really good crew utilization in the quarter, where we're able to meet demand faster by having a deeper capacity.

And you're seeing the benefits of that in the quarter, right? So -- and we did a -- we're doing a faster -- one of the big changes that we've made as a company is to go faster on integration.

Historically, we would have left businesses alone for a long time, but we really have benefited very quickly from bringing that team on. And we got on top of that some great managers with the -- to complement our great team.

So it's just a better business. And we've got strong clients and strong demand, and we're nicely positioned.

My comments previously were meant to mirror the general caution out there because of oil prices, but we see very good demand for our products and services, as illustrated by the quarter.

So bob, I wanted to ask about the revamp of DataBridge that you talked about in connection with the Voyanta and just onto the single analytics platform. Can you flesh out a little bit the timing for that sort of development project?

And I guess, separate question would be the timing for any -- the timing for the integration with the other data sets?

Yes. So we -- I think part of the reason that NCREIF wanted to go with us is obviously we've got -- we had already done a really, really good job with DataBridge and DataExchange in terms of really collecting data for our customers, then presenting it back to them in a way that they could manage their business better at an asset level and a portfolio level.

When you combine it with NCREIF, it really -- one plus one really accelerates their members to have the ability to have insights into performance, right? But the compelling driver around that is the power of Voyanta in terms of being able to bring that information together and do custom reporting, look at different ways of -- looking at your business gives us another leg up in terms of the product roadmap that we could envision and working with this organization.

So they loved it. And member organizations that decide to purchase Voyanta are going to have then again be able to bring their data into this platform.

And so it's multidimensional, it's exciting, it provides innovation for our offerings, but it also increases a lot of value for NCREIF members. So that's -- it just became something that was such an obvious thing to do.

And we're going manage that whole process on behalf of NCREIF.

Is that a -- just to circle back on that, is that a 2015 introduction?

Yes, yes, yes, definitely, early first half of 2015. We're in flight.

We've hired people to do the revamp. And frankly, one of the original decisions to make an investment in Voyanta that we thought of as not only an ideal platform for this partnership, but it was an idea platform for RVA as we go global.

And Bob Ruggles and Rick Kalvoda work with Raj to lay out a roadmap around that. And by working with Voyanta, we take out a huge amount of custom development because they have a platform that's tuned for real estate, tuned for currency, tuned for how our customers do business.

And it's really optimized to ingest additional data, so it's like a perfect storm.

That's great. Next question was just on the ARGUS.

I was curious as to whether there's any demand or any push or plans for a SaaS offering there or a hosted?

I would -- the way I would answer that question is that I think the market is absolutely looking for SaaS-based solutions. And we feel that there's some elements of ARGUS over time that we would make available in that environment.

And if you think about Voyanta as already it was built on a SaaS standard, we have an opportunity, as we build out the integration of ARGUS, to start making data right -- available right into a cloud environment via Voyanta as we go forward. So that was, again, one of the reasons that we ended up purchasing Voyanta.

It gives us the opportunity to push data in a collaborative way, but we could envision that you'll see features of ARGUS in the cloud over time as well.

Okay. Last question for me, and that is the -- just any comments you would have on the CoStar launch in Toronto that they've talked about on their call just a couple of weeks ago and their expansion plans across Canada.

I don't know what you can tell us about how you feel if at all that impacts the different parts of your business competitively?

Well, I think CoStar has a -- has had a really good track record of delivering on what they say. And there's elements of the market that are attractive to them.

But in the markets that we are currently serving, we like our chances a lot more. We've got the historical data, we have the people, we've got the experience, we've got multiple partnerships and we are adding data everyday from our RVA or Tax and our cost business that we expect to exploit even more.

So I would say that we would treat CoStar as a force, a formidable competitor, but we're already all across Canada and we've got the history, and I think we're pretty good competitors.

On the ARGUS and RVA, you guys have done a great job instead of offsetting ongoing investments with increased sales, but can you kind of talk about how we should think about 2015 in the investments that are required, and what sort of margin impact that might have?

Yes. Look, we're not -- what we've argued for -- from the time I was here is to be seen as a growth business.

And what I've been really trying to drive to is that we're going to make the long-term investment. This is an incredibly attractive market.

But if you follow along, for the most part, we've delivered on the margin as we've done it. So this isn't about trying to move to a place where we're going to dramatically drop our EBITDA margins.

If any particular quarter they drop into the mid 20s or even low 20s, it's not something that is going to -- it will be a one-off type of event. And it's really tied to us making sure that we've put the resources out there to realize the opportunity in these markets.

And so it's not -- we've proven, I think, and I've said it, that we're going to grow while we invest, and we're going to be very careful about taking those points. One of the reasons that we're talking about it again on this call is that Voyanta is still in the growth phase, right?

It's a startup. And so we've got some incredibly talented people, but we have to make it profitable in the standalone basis, and that will take us a few quarters.

But it's not going to dramatically erode our margin. And certainly, when you look at it at a company level, it will be modest.

Okay, great. And then on ARGUS Enterprise, you talked about 400 customers versus an overall DCF user base, I think you said about 4,000.

Can you kind of talk about how you're going into that user base, and what percentage you're targeting to move over to AE and what the sales process there looks like?

Well, we're going to move everybody to AE, that's the whole idea. And part of what we're trying to do is to target -- and sorry, just to remind you, a high percentage of that base is in the U.S., right?

So we definitely have a game plan to move the big players. We've seen a number of our RVA clients move there.

We've talked previously about cases about running ARGUS Enterprise on a global basis. We're seeing more of those type of opportunities.

And clearly, we're starting to see the correlation between companies want to having things like an appraisal management or independent appraisal in Europe and the U.S. has correlated with having visibility of their portfolio on a global basis.

So we're -- we've got a series of activities at a corporate level, we've invested in sales in every one of the markets and we've got a multi-prong effort going on around ARGUS.

Okay, great. And just finally, on the European RVA opportunity, can you talk a bit about -- you mentioned 2 big client wins.

Can you talk about how the market over there is evolving and your advantage over the competition and what you're seeing there?

Yes, the way it's evolving is that there's a -- so a couple of things to look at. We created a standard in the U.S.

for Appraisal Management. And it's -- the primary driver of Appraisal Management was to have true independence particularly on open funds.

We married that up with DataBridge. So not only did they have independence, but they get better visibility on their performance on a quarter-over-quarter basis, with the analytics to go with that.

And then we added benchmarking to that. And what these financial institutions have the biggest invest in the U.S.

is a standard of transparency and good governance that you would expect from an open-funded environment, right? Well, that same standard exists in Europe.

That requirement has not been served, and we're first in the market to serve it. And we expect that those financials, institutions that are running this type of services in the U.S.

are going to want them in Europe. And our advantage is that we're the global leader already and we're taking that leadership to Europe.

Just wanted to follow up, Bob, in your prepared remarks. I mean, you talked a lot about Voyanta and RealNet and the partnership with NCREIF, and you talked about building out this real estate data model.

Do you have like a timeline in mind? And along those lines, do you have any other legs you need to add to the stool in rolling out this more comprehensive suite of products?

I think we have all of the elements in place. And remember that this is -- the efforts that we drive in data serve our services business.

And as we evolve our services business, it gives us more data, right? So the way to imagine it is we're already getting the benefits now.

By signing agreement with NCREIF and putting Voyanta out there, that will encourage our existing customers to put more assets on our BPL platform. And the more assets they put on the platform, the better we do, right?

And so what we would envision is that we would find ourselves in more relationships with other data providers to create value and we'll monetize that by more assets under management, new products in the market, greater sales of Voyanta, greater sales of ARGUS. So this is an integrated monetization model.

And at the end of it, we expect that we're going to have privilege in the data market that will allow us to monetize that as the business line onto itself. So we're putting all the pieces in place, and we're investing in the right places to be able to go after this.

And the way I would look at it is that we're already benefiting from our existing businesses, and we see that data could be an incremental business down the road. I don't want to put a timeline on it because we may prefer in the short term to make this data available to our existing clients in a way that it carries the ability to do more with them.

So I don't want to speculate on what our future business model is. We're doing fine right now.

So on the European RVA side of things, so were all these systems developed for that market? Because I know last quarter, you talked about having to develop and change some systems in order for that market to really be able to penetrate that market.

We absolutely have the ability to support these 2 existing customers. And what we'll intend to do is to use some of our newer technology as they get started.

And we're working through the ramp-up on that right now. So we don't have any limitations in terms of bringing on these clients.

Now do you have any limitation on bringing other clients?

Absolutely not.

No? Okay, okay.

And then just following on the questions on the Geomatics margins in Q3, if I look back in the last number of years, it seems like Q3 always is the strongest by decent percentage margin quarter in the year. Is there seasonality to that?

Definitely, yes, because like it's the highest full utilization quarter by weather, by project startup, the pre-winter work that gets done, and we very rarely have interruptions in that quarter. So yes, definitely.

Okay. And then in terms of on the tax side of things, Robert, you talked a bit about sequentially some seasonality in Q3 in terms of on their revenue side.

Is that -- can you just give me -- what's the main reason for that?

It's just tax, like if you go back in history, you'll see movement around tax. On a full year basis, we're very comfortable with our tax business.

But we had an amazing Q2, you saw the results. And by virtue of both our time and maturity and on our contingency revenue, we saw a real strong finish in Q2.

And we didn't see the same thing in Q3, but the business is there. And on a full year basis, you're going to see this to have -- if you look at, historically, Q4 has always been a pretty good quarter for us.

And there's nothing indicating that -- I'm not giving forward guidance. I was close to giving forward guidance.

But on a full year basis, we feel great about the business. And Jim Derbyshire, who I think I saw on the call, would always tell you to measure tax on a full year basis.

He reminds me of that every time I talk to him.

All right, okay. And then the investment you're putting in that business you talked about at this quarter, is that predominantly U.S.?

And is that new hires? Or what's that?

In the tax business?

In the tax business, yes.

Yes, yes, yes. Those were new hires.

So have you entered any new geographies or new hires in existing offices that you hope...

We're adding in some of our smaller offices and we're really doubling down on our industrial group. And we believe that's a market that's pretty good for us.

So...

Okay. And then last year, on the U.S.

RVA side, you -- I think Angelo might have mentioned that you had a few new customer wins. I was just wondering if you -- any of those were in kind of the debt funds or the closed-end funds?

And what kind of progress are you making going there?

Yes, we -- what we've -- on the closed funds, we are adding closed funds with our existing customer base. But the other thing that's happened is when customers saw what we're doing with NCREIF, they are at the point with the capability of attribution where we're going to mop up the rest of the open market.

I don't want to say mop up. We -- they love the value that this is going to drive, and you wouldn't want to be without it.

And my expectation is that as they use these tools, they're going to want to use them in other parts of their business, right? And that's the opportunity going forward.

So yes, we've added closed funds and even some debt work, debt fund work with some of our existing clients because they love the tools.

I wouldn’t want to prolong the call too much further. Bob, it sounds like you're making good progress.

You've made a number of acquisitions that seem to be paying off to the strategy. Maybe if you could just talk about your executive team in your travels, and as you're assembling a company with some new growth drivers, are there any parts of functionality for the executive team that you think the company now needs?

We need to go recruit an executive to do x? Or are there any other observations you'd make on the groups you're acquiring in terms of the skill set they have to perhaps help inform the culture of the overall organization?

Yes, we've added a bunch of people organically in our tax business and the cost business here in Canada, that it's -- some really, really great talent in Western Canada for P3. Obviously, the team we set up in Luxembourg, these guys are the best of the best.

They have amazing relationships or highly followed, but these acquisitions are giving us incredible talent as well. You look at George Carras, I mean, he's a highly respected speaker on the real estate markets.

He already has jumped in, in terms of helping with business development and marketing. We're envisioning integrated products with our cost business.

And immediately, he's leading the charge with his team. And there's some great people in RealNet that are helping us to shape our plan for Canada.

Similarly, our team in Voyanta, the debt and breadth of that team, and the innovation around cloud with that team gives us another critical mass in Europe. So a part of these acquisitions are intended to lock up the best of the best in the real estate market and then to organize ourself to take advantage of these opportunities.

So we've got searches out, we're buying companies, we're attracting the best people in the industry, and we find ourselves in a place where I put my team up against any company in the world.

Excellent. And then, I guess, in terms of benchmarking your progress towards a slightly different company that you're shaping and have been shaping over the past couple of years in terms of acquiring technology or complementary products, how far are you towards like the end job, or you would say, we've got everything we need at this point?

I think we have most of what we need, right? And the interesting part, if you look at the RealNet acquisition, that gave us a bunch of history and some highly talented people, right?

So look, I -- we'd always be interested in partnerships or we would consider acquisitions of data companies that extend our value, but it's not like we have to do it. We've had enough potential partnerships and enough data in our current business model that we can go a long way without having to do it.

So we're in a really nice position where we can be picky. We can make sure that we're patient in terms of bringing new capability into our business.

And we happen to have relationships with the best companies, the most important companies in the world in the real estate asset management space. So we've got a lot of what we need right now to shape this industry.

And as you get bigger and better, and your market value grows, you get to reach. And we will.

Well, listen, I've talked enough already. I really appreciate the support.

It was a great quarter. We have an amazing team, and we're just getting started.

So thanks for joining the call.