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  "documentTitle": "WSP Global Inc. (WSP)",
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  "authorName": "Spruce Point Capital Management",
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  "presentationDate": "2024-04-03 00:00:00",
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      "text": "WSP updated its assumptions related to goodwill testing that should give investors cause for concern. WSP uses 2% - 5% revenue growth for projections despite organic growth having averaged 6% in the past three years and management is projecting 5% - 8% organic growth in 2024. In addition, WSP forecasts assumes 11.8% - 23.5% Adj. EBITDA margin despite projecting 18.2% in 2024 and not having reported Adj. EBITDA margin less than 13.3% in any geographic segment since 2020.",
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      "text": "WSP updated its assumptions related to goodwill testing that should give investors cause for concern.",
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      "text": "Why is management forecasting 11.8% - 23.5%? The lowest Adj. EBITDA margin since 2020 during COVID-19 was the EMEIA segment at 13.3%.",
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      "text": "Why is management forecasting 2% - 5%? Organic growth averaged 6% in the past three years and WSP just guided to 5% - 8% in 2024.",
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      "text": "organic growth: 2% - 5%",
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      "text": "MATERIAL ESTIMATES USED IN DETERMINING THE FVLCS\nCASH FLOW PROJECTIONS\nThe cash flow projections are based on the financial forecast approved by Management and the Board of Directors. These projections use assumptions that reflect the Corporation's most likely planned course of action, given Management's judgment of the most probable set of economic conditions, adjusted to reflect the expectations of a market participant. Adjusted EBITDA margin is based on budgeted values in the first year of the five-year projection period (\"projection period\"), with increases over the projection period using an estimated revenue growth rate. The revenue growth rates applied following the first year's projections ranged from 2.0% to 5.0%. The adjusted EBITDA margin ranged from 11.8% to 23.5%. Management considered past experience, economic trends as well as industry and market trends in assessing reasonableness of financial projections used.",
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      "text": "Source: 2023 Annual Report and Year End Earnings Release",
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      "text": "Warning: Goodwill Testing Forecasts Below Recent Performance And Guidance",
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