DCM Data Communications Management Corp

THIRD QUARTER 2023 HIGHLIGHTS

• Q3 revenue up +93.6% vs. Q3 2022 to $122.7 million

• Gross profit up +52.4% vs. Q3 2022 to $30.3 million

• Adjusted EBITDA up 28.2% vs. Q3 2022 to $11.8 million

• Total net debt of $95.4 million at quarter-end, down 32% since the April close of the MCC acquisition

• DCM raises guidance on expected merger synergies to $30-$35 million over the next 18-24 months

DATA Communications Management Corp. (TSX: DCM; OTCQX: DCMDF) (“DCM” or the "Company"), a leading provider of marketing and business communication solutions to companies across North America, today reported its third quarter 2023 financial results.

“We are pleased with our continued progress building a better and a bigger business as reflected in our third quarter results and the positive momentum of our integration efforts since completing the acquisition of Moore Canada Corporation (“MCC”) six months ago,” said Richard Kellam, Chief Executive Officer, and President of DCM. “The combined business delivered solid performance building value with existing customers, securing new client wins and optimizing strategic revenue opportunities.”

Continued Kellam “Our post-merger initiatives are progressing ahead of plan and given our success to date driving savings and efficiency improvements, we are revising our guidance for expected total annualized synergies to a range between $30 and $35 million over the next 18 to 24 months, from a previous range of $25 to $30 million. We are excited about the opportunities in front of us to build on our strong start as a combined company focusing on driving growth and value creation.”

BUILDING A BETTER BUSINESS

Following is an update on the four areas of focus in DCM’s post-merger integration planning:

Operations - We have announced plans to consolidate our footprint from 14 to 10 facilities over the next two years to take advantage of open capacity in our network, enhance our asset utilization and drive operational efficiencies. The closure of one of these facilities in Edmonton, Alberta, will be finalized by December 2023. We expect this action, along with other headcount reductions in Operations completed to date, are expected to result in annualized operational savings next year of approximately $3.75 million; expected savings from the consolidation of our three other facilities will be announced in future quarters. We have also entered into purchase and sale agreements for our Fergus and Trenton, Ontario facilities, which are expected to generate net proceeds of approximately $15 million.

Organizational - The integration of key functions such as our Commercial and Operations teams is completed, with new leadership teams in place and simplified reporting structures; with headcount reductions completed in our SG&A functions to date, we expect annualized SG&A savings next year of approximately $9 million.

Procurement - The centralization of purchasing is progressing on plan, and we are leveraging our expanded scale to deliver anticipated savings and reduce outsourcing of products; with initiatives completed to date, we expect annualized procurement savings next year of approximately $4.75 million.

Revenue Growth - Our combined Commercial teams are focused on expanding services with existing clients and winning new business. Since closing the MCC acquisition, we are pleased to report our collective sales pipeline has shown strong growth, and importantly we’ve secured a total of $18 million of expansion revenue from existing customers and new business.

Collectively, Operations, Organizational and Procurement initiatives, we have initiated to date are expected to generate annualized savings of approximately $17.5 million next year, representing +53% of the mid-point of our revised total synergy target.

BUILDING A BIGGER BUSINESS

• Revenue for the third quarter of 2023 was up +93.6%, or +$59.3 million, vs. Q3 year ago (YA), for total revenues of $122.7 million, reflecting additional business from the MCC acquisition.

• Gross profit accelerated +52.4%, or +$10.4 million for a total of $30.3 million; Gross profit as a percentage of revenues was 24.7% for the third quarter of 2023 vs. 31.4% YA. As expected, the lower average gross profit margins of MCC contributed to lower overall gross profit as a percentage of revenues. DCM has a clear plan intended to return the combined gross profit margins to pre-acquisition levels going forward.

• Adjusted EBITDA1 increased +28.2% compared to last year, and was $11.8 million or 9.6% of revenue vs. $9.2 million or 14.5% of revenues YA. Adjusted EBITDA as a percentage of revenues declined due to the lower average MCC gross margins.

• DCM recorded one-time adjustments in the quarter of $0.2 million related to the acquisition and integration of MCC, along with restructuring costs of $7.0 million.

The balance of our total credit facilities at the end of the third quarter of 2023, after deducting cash on hand of $22.3 million, was $95.4 million (total net debt), down -32% since closing the MCC acquisition.

THIRD QUARTER 2023 EARNINGS CALL

The Company will host a conference call and webcast on Thursday, November 9, 2023, at 9:00 a.m. Eastern time. Mr. Kellam, and James Lorimer, CFO, will present the third quarter 2023 results followed by a live Q&A period.

Instructions on how to access both the webcast and call are available below. For those unable to join live, a replay of the webcast will be available on the DCM Investor Relations page.

DCM will be using Microsoft Teams to broadcast our earnings call, which will be accessible via the options below:

Click here to join the meeting

Meeting ID: 242 523 413 22 Passcode: XtHDYT

Or call in (audio only)

+1 647-749-9154,,126841512# Canada, Toronto Phone Conference ID: 126 841 512#

The Company’s full results will be posted on its Investor Relations page and on www.sedar.com. A video message from Mr. Kellam will also be posted on the Company’s website.

TABLE 1 The following table sets out selected historical consolidated financial information for the periods noted.

For the periods ended September 30, 2023 and 2022

July 1 to September 30, 2023

July 1 to September 30, 2022

January 1 to September 30, 2023

January 1 to September 30, 2022

(in thousands of Canadian dollars, except share and per share amounts, unaudited)

 

 

 

 

 

Revenues

$

122,721

 

$

63,399

 

$

317,761

 

$

200,759

 

 

 

 

 

 

Gross profit

 

30,341

 

 

19,904

 

 

86,151

 

 

60,670

 

 

 

 

 

 

Gross profit, as a percentage of revenues

 

24.7

%

 

31.4

%

 

27.1

%

 

30.2

%

 

 

 

 

 

Selling, general and administrative expenses

 

25,065

 

 

13,656

 

 

61,944

 

 

40,803

 

As a percentage of revenues

 

20.4

%

 

21.5

%

 

19.5

%

 

20.3

%

 

 

 

 

 

Adjusted EBITDA

 

11,790

 

 

9,196

 

 

38,378

 

 

28,400

 

As a percentage of revenues

 

9.6

%

 

14.5

%

 

12.1

%

 

14.1

%

 

 

 

 

 

Net (loss) income for the period

 

(4,185

)

 

2,816

 

 

(9,496

)

 

10,286

 

 

 

 

 

 

Adjusted net income

 

1,778

 

 

3,719

 

 

11,465

 

 

11,396

 

As a percentage of revenues

 

1.4

%

 

5.9

%

 

3.6

%

 

5.7

%

 

 

 

 

 

Basic (loss) earnings per share

$

(0.08

)

$

0.06

 

$

(0.19

)

$

0.23

 

Diluted (loss) earnings per share

$

(0.08

)

$

0.06

 

$

(0.19

)

$

0.22

 

Adjusted net income per share, basic

$

0.03

 

$

0.08

 

$

0.23

 

$

0.26

 

Adjusted net income per share, diluted

$

0.03

 

$

0.08

 

$

0.23

 

$

0.24

 

Weighted average number of common shares outstanding, basic

 

55,022,883

 

 

44,062,831

 

 

49,420,414

 

 

44,062,831

 

Weighted average number of common shares outstanding, diluted

 

55,022,883

 

 

46,501,606

 

 

49,420,414

 

 

46,516,249

 

TABLE 2 The following table provides reconciliations of net (loss) income to EBITDA and of net (loss) income to Adjusted EBITDA for the periods noted.

EBITDA and Adjusted EBITDA reconciliation

For the periods ended September 30, 2023 and 2022

July 1 to September 30, 2023

July 1 to September 30, 2022

January 1 to September 30, 2023

January 1 to September 30, 2022

(in thousands of Canadian dollars, unaudited)

 

 

 

 

 

Net (loss) income for the period

$

(4,185

)

$

2,816

 

$

(9,496

)

$

10,286

 

 

 

 

 

Interest expense, net

 

5,072

 

 

1,233

 

 

9,654

 

 

3,831

Amortization of transaction costs and debt extinguishment gain, net

 

141

 

 

84

 

 

320

 

 

257

Current income tax expense

 

(1,495

)

 

1,143

 

 

842

 

 

3,803

Deferred income tax (recovery) expense

 

(2,227

)

 

(236

)

 

(5,128

)

 

204

Depreciation of property, plant and equipment

 

2,051

 

 

760

 

 

4,107

 

 

2,321

Amortization of intangible assets

 

888

 

 

402

 

 

2,052

 

 

1,213

Depreciation of the ROU Asset

 

3,575

 

 

1,786

 

 

8,012

 

 

4,999

EBITDA

$

3,820

 

$

7,988

 

$

10,363

 

$

26,914

Acquisition and integration costs

 

244

 

 

—

 

 

10,199

 

 

—

Restructuring expenses

 

7,009

 

 

—

 

 

9,738

 

 

—

Net fair value (gains) losses on financial liabilities at fair value through profit or loss

 

717

 

 

1,208

 

 

8,078

 

 

1,486

Adjusted EBITDA

$

11,790

 

$

9,196

 

$

38,378

 

$

28,400

TABLE 3 The following table provides reconciliations of net (loss) income to Adjusted net income and a presentation of Adjusted net income per share for the periods noted.

Adjusted net income reconciliation

For the periods ended September 30, 2023 and 2022

July 1 to September 30, 2023

July 1 to September 30, 2022

January 1 to September 30, 2023

January 1 to September 30, 2022

(in thousands of Canadian dollars, except share and per share amounts, unaudited)

 

 

 

 

 

Net (loss) income for the period

$

(4,185

)

$

2,816

 

$

(9,496

)

$

10,286

 

 

 

 

 

 

Acquisition and integration costs

 

244

 

 

—

 

 

10,199

 

 

—

 

Restructuring expenses

 

7,009

 

 

—

 

 

9,738

 

 

—

 

Net fair value (gains) losses on financial liabilities at fair value through profit or loss

 

717

 

 

1,208

 

 

8,078

 

 

1,486

 

Tax effect of the above adjustments

 

(2,007

)

 

(305

)

 

(7,054

)

 

(376

)

Adjusted net income

$

1,778

 

$

3,719

 

$

11,465

 

$

11,396

 

 

 

 

 

 

Adjusted net income per share, basic

$

0.03

 

$

0.08

 

$

0.23

 

$

0.26

 

Adjusted net income per share, diluted

$

0.03

 

$

0.08

 

$

0.23

 

$

0.24

 

Weighted average number of common shares outstanding, basic

 

55,022,883

 

 

44,062,831

 

 

49,420,414

 

 

44,062,831

 

Weighted average number of common shares outstanding, diluted

 

55,022,883

 

 

46,501,606

 

 

49,420,414

 

 

46,516,249

 

About DATA Communications Management Corp.

DCM is a marketing and business communications partner that helps companies simplify the complex ways they communicate and operate, so they can accomplish more with fewer steps and less effort. For over 60 years, DCM has been serving major brands in vertical markets including financial services, retail, healthcare, energy, other regulated industries, and the public sector. We integrate seamlessly into our clients’ businesses thanks to our deep understanding of their needs, transformative tech-enabled solutions, and end-to-end service offering. Whether we’re running technology platforms, sending marketing messages, or managing print workflows, our goal is to make everything surprisingly simple.

Additional information relating to DATA Communications Management Corp. is available on www.datacm.com, and in the disclosure documents filed by DATA Communications Management Corp. on the System for Electronic Document Analysis and Retrieval (SEDAR) at www.sedar.com.

FORWARD-LOOKING STATEMENTS

Certain statements in this press release constitute “forward-looking” statements that involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance, objectives or achievements of DCM, or industry results, to be materially different from any future results, performance, objectives or achievements expressed or implied by such forward-looking statements. When used in this press release, words such as “may”, “would”, “could”, “will”, “expect”, “anticipate”, “estimate”, “believe”, “intend”, “plan”, and other similar expressions are intended to identify forward-looking statements. These statements reflect DCM’s current views regarding future events and operating performance, are based on information currently available to DCM, and speak only as of the date of this press release. These forward-looking statements involve a number of risks, uncertainties and assumptions and should not be read as guarantees of future performance or results, and will not necessarily be accurate indications of whether or not such performance or results will be achieved. Many factors could cause the actual results, performance, objectives or achievements of DCM to be materially different from any future results, performance, objectives or achievements that may be expressed or implied by such forward-looking statements. The principal factors, assumptions and risks that DCM made or took into account in the preparation of these forward-looking statements, and which could cause our actual results and financial condition to differ materially from those indicated in the forward-looking statements, include: our operating results are sensitive to economic conditions, which can have a significant impact on us, and uncertain economic conditions may have a material adverse effect on our business, results of operations and financial condition; our ability to successfully integrate the DCM and MCC businesses and realize anticipated synergies from the combination of those businesses, including revenue and profitability growth from an enhanced offering of products and services, larger customer base and cost reductions from synergies; the expected annualized synergies that the Company expects to derive from the MCC acquisition have been estimated by the Company based on its experience integrating previously acquired businesses, other facilities and completing restructuring initiatives, and includes estimated benefits expected to be derived from the acquisition, including those related to site sales and consolidations, operational improvements, eliminating redundant positions, and purchasing synergies; the expected annualized cost savings have not been prepared in accordance with IFRS, nor has a reconciliation to IFRS been provided and the Company evaluates its financial performance on the basis of these non-IFRS measures and therefore the Company does not consider their most comparable IFRS measures when evaluating prospective acquisitions; the acquisition of MCC involves a number of risks, including the possibility that the Company paid more than the acquired assets are worth, the Company may fail to realize the expected benefits from the acquisition, the additional expense and management resources associated with completing and integrating the MCC acquisition and amortizing any acquired intangible assets, the difficulty of integrating and assimilating the operations and personnel of the MCC business, the challenge of implementing uniform standards, controls procedures, systems, and policies throughout the business, the inability to integrate, train, retain and motivate key personnel of the MCC business, the potential disruption of the Company’s ongoing business and the distraction of management from its day-to-day operations, and the potential impairment of relationships with the Company’s employees, clients, suppliers and strategic partners; there is limited growth in the traditional printing business, which may impact our ability to grow our sales or even maintain historical levels of sales of printed business and marketing communications materials; competition from competitors supplying similar products and services, some of whom have greater economic resources than us and are well established suppliers; increases in the cost of, and supply constraints related to, paper, ink and other raw material inputs used by DCM, as well as increases in freight costs, may adversely impact the availability of raw materials and our production, revenues and profitability; our ability to meet our revenue, profitability and debt reduction targets; our ability to comply with our financial covenants under our credit facilities or to obtain financial covenant waivers from our lenders if necessary; our ability to complete the proposed sales and leasebacks of certain properties and substantially reduce our bank term loan and total indebtedness; we may not be successful in obtaining capital to fund our business plans on satisfactory terms (or at all), including, without, limitation, with respect to investments in digital innovation (such as the development and successful marketing and sale of new digital capabilities), and capital expenditures; all of our outstanding indebtedness under our bank credit facility is subject to floating interest rates, and therefore is subject to fluctuations in interest rates, an increase of which would increase our borrowing costs. Additional factors are discussed elsewhere in this press release and under the headings "Liquidity and capital resources" and “Risks and Uncertainties” in DCM’s management’s discussion and analysis and in DCM’s other publicly available disclosure documents, as filed by DCM on SEDAR (www.sedar.com). Should one or more of these risks or uncertainties materialize, or should assumptions underlying the forward-looking statements prove incorrect, actual results may vary materially from those described in this press release as intended, planned, anticipated, believed, estimated or expected. Unless required by applicable securities law, DCM does not intend and does not assume any obligation to update these forward-looking statements.

NON-IFRS MEASURES

This press release includes certain non-IFRS measures as supplementary information. Except as otherwise noted, when used in this press release, EBITDA means earnings before interest and finance costs, taxes, depreciation and amortization and Adjusted EBITDA means EBITDA adjusted for restructuring expenses, integration costs, acquisition costs and the net fair value (gains) losses on financial liabilities at fair value through profit or loss for restricted share units ("RSUs") and deferred shared units ("DSUs"). Adjusted net income (loss) means net income (loss) adjusted for restructuring expenses, acquisition costs, integration costs, net fair value (gains) losses on financial liabilities at fair value through profit or loss for RSUs and DSUs and the tax effects of those items. Adjusted net income (loss) per share (basic and diluted) is calculated by dividing Adjusted net income (loss) for the period by the weighted average number of common shares of DCM (basic and diluted) outstanding during the period. Adjusted EBITDA as a percentage of revenues means Adjusted EBITDA divided by revenues and Adjusted net income (loss) as a percentage of revenues means Adjusted net income (loss) divided by revenues, in each case for the same period. In addition to net income (loss), DCM uses non-IFRS measures and ratios, including Adjusted net income (loss), Adjusted net income (loss) per share, Adjusted net income (loss) as a percentage of revenues, EBITDA, Adjusted EBITDA and Adjusted EBITDA as a percentage of revenues to provide investors with supplemental measures of DCM’s operating performance and thus highlight trends in its core business that may not otherwise be apparent when relying solely on IFRS financial measures. The Company’s estimates as to expected annualized synergies have not been prepared in accordance with IFRS, nor has a reconciliation to IFRS been provided. The Company evaluates its financial performance on the basis of these non-IFRS measures and therefore the Company does not consider their most comparable IFRS measures when evaluating prospective acquisitions. DCM also believes that securities analysts, investors, rating agencies and other interested parties frequently use non-IFRS measures in the evaluation of issuers. DCM’s management also uses non-IFRS measures in order to facilitate operating performance comparisons from period to period, prepare annual operating budgets and assess its ability to meet future debt service, capital expenditure and working capital requirements. Adjusted net income (loss), Adjusted net income (loss) per share, EBITDA, Adjusted EBITDA and synergy estimates, are not earnings measures recognized by IFRS and do not have any standardized meanings prescribed by IFRS. Therefore, Adjusted net income (loss), Adjusted net income (loss) per share, Adjusted net income (loss) as a percentage of revenues, EBITDA, Adjusted EBITDA, Adjusted EBITDA as a percentage of revenues and synergy estimates are unlikely to be comparable to similar measures presented by other issuers.

Investors are cautioned that Adjusted net income (loss), Adjusted net income (loss) per share, EBITDA and Adjusted EBITDA should not be construed as alternatives to net income (loss) determined in accordance with IFRS as an indicator of DCM’s performance. For a reconciliation of net income (loss) to EBITDA, a reconciliation of net income (loss) to Adjusted EBITDA, reconciliation of net income (loss) to Adjusted net income (loss) and a presentation of Adjusted net income (loss) per share, see Table 2 and Table 3 above.

Condensed interim consolidated statements of financial position

(in thousands of Canadian dollars, unaudited)

September 30, 2023

December 31, 2022

 

$

$

 

 

 

Assets

 

 

Current assets

 

 

Cash and cash equivalents

$

22,310

 

$

4,208

 

Trade receivables

 

104,116

 

 

54,630

 

Inventories

 

35,061

 

 

20,220

 

Prepaid expenses and other current assets

 

5,871

 

 

2,984

 

Income taxes receivable

 

2,788

 

 

15

 

Assets held for sale

 

16,226

 

 

—

 

 

 

186,372

 

 

82,057

 

Non-current assets

 

 

Other non-current assets

 

3,217

 

 

466

 

Deferred income tax assets

 

7,599

 

 

4,830

 

Property, plant and equipment

 

35,845

 

 

6,779

 

Right-of-use assets

 

159,285

 

 

33,505

 

Pension assets

 

1,791

 

 

2,364

 

Intangible assets

 

13,267

 

 

2,507

 

Goodwill

 

16,996

 

 

16,973

 

 

$

424,372

 

$

149,481

 

 

 

 

Liabilities

 

 

Current liabilities

 

 

Trade payables and accrued liabilities

$

72,099

 

$

44,133

 

Current portion of credit facilities

 

15,653

 

 

11,667

 

Current portion of lease liabilities

 

8,195

 

 

6,791

 

Provisions

 

7,712

 

 

1,316

 

Income taxes payable

 

—

 

 

1,630

 

Deferred revenue

 

4,663

 

 

3,942

 

 

 

108,322

 

 

69,479

 

Non-current liabilities

 

 

Provisions

 

1,442

 

 

0

 

Credit facilities

 

100,292

 

 

15,380

 

Lease liabilities

 

144,332

 

 

33,011

 

Deferred income tax liabilities

 

4,686

 

 

—

 

Pension obligations

 

16,732

 

 

6,069

 

Other post-employment benefit plans

 

3,721

 

 

2,695

 

Asset retirement obligation

 

3,230

 

 

—

 

 

$

382,757

 

$

126,634

 

 

 

 

Equity

 

 

Shareholders’ equity

 

 

Shares

$

283,738

 

$

256,478

 

Warrants

 

219

 

 

869

 

Contributed surplus

 

2,984

 

 

3,131

 

Translation Reserve

 

204

 

 

207

 

Deficit

 

(245,530

)

 

(237,838

)

 

$

41,615

 

$

22,847

 

 

$

424,372

 

$

149,481

 

Condensed interim consolidated statements of operations

 

 

 

 

(in thousands of Canadian dollars, except per share amounts, unaudited)

For the three months ended September 30, 2023

 

For the three months ended September 30, 2022

 

For the nine months ended September 30, 2023

 

For the nine months ended September 30, 2023

 

$

 

$

 

$

 

$

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenues

$

122,721

 

 

$

63,399

 

 

317,761

 

 

200,759

 

 

 

 

 

 

 

 

Cost of revenues

 

92,380

 

 

 

43,495

 

 

231,610

 

 

140,089

 

 

 

 

 

 

 

 

Gross profit

 

30,341

 

 

 

19,904

 

 

86,151

 

 

60,670

 

 

 

 

 

 

 

 

Expenses

 

 

 

 

 

 

 

Selling, commissions and expenses

 

10,010

 

 

 

7,114

 

 

28,181

 

 

21,375

General and administration expenses

 

15,055

 

 

 

6,542

 

 

33,763

 

 

19,428

Restructuring expenses

 

7,009

 

 

 

—

 

 

9,738

 

 

—

Acquisition and integration costs

 

244

 

 

 

—

 

 

10,199

 

 

—

Net fair value (gains) losses on financial liabilities at fair value through profit or loss

 

717

 

 

 

1,208

 

 

8,078

 

 

1,486

 

 

33,035

 

 

 

14,864

 

 

89,959

 

 

42,289

 

 

 

 

 

 

 

 

(Loss) income before finance and other costs, and income taxes

 

(2,694

)

 

 

5,040

 

 

(3,808

)

 

18,381

 

 

 

 

 

 

 

 

Finance costs

 

 

 

 

 

 

 

Interest expense on long term debt and pensions, net

 

2,550

 

 

 

676

 

 

5,573

 

 

2,146

Interest expense on lease liabilities

 

2,522

 

 

 

557

 

 

4,081

 

 

1,685

Amortization of transaction costs net of debt extinguishment gain

 

141

 

 

 

84

 

 

320

 

 

257

 

 

5,213

 

 

 

1,317

 

 

9,974

 

 

4,088

 

 

 

 

 

 

 

 

(Loss) income before income taxes

 

(7,907

)

 

 

3,723

 

 

(13,782

)

 

14,293

 

 

 

 

 

 

 

 

Income tax expense

 

 

 

 

 

 

 

Current

 

(1,495

)

 

 

1,143

 

 

842

 

 

3,803

Deferred

 

(2,227

)

 

 

(236

)

 

(5,128

)

 

204

 

 

(3,722

)

 

 

907

 

 

(4,286

)

 

4,007

 

 

 

 

 

 

 

 

Net (loss) Income for the period

$

(4,185

)

 

$

2,816

 

 

(9,496

)

 

10,286

Condensed interim consolidated statements of cash flows

 

(in thousands of Canadian dollars, unaudited)

For the nine months ended September 30, 2023

 

For the nine months ended September 30, 2022

 

$

 

$

 

 

 

 

Cash provided by (used in)

 

 

 

 

 

 

 

Operating activities

 

 

 

Net (loss) income for the period

$

(9,496

)

 

$

10,286

 

Items not affecting cash

 

 

 

Depreciation of property, plant and equipment

 

4,107

 

 

 

2,321

 

Amortization of intangible assets

 

2,052

 

 

 

1,213

 

Depreciation of right-of-use-assets

 

8,012

 

 

 

4,999

 

Interest expense on lease liabilities

 

4,081

 

 

 

1,685

 

Share-based compensation expense

 

524

 

 

 

238

 

Pension expense

 

837

 

 

 

327

 

Loss on disposal of property, plant and equipment

 

—

 

 

 

68

 

Provisions

 

9,738

 

 

 

—

 

Amortization of transaction costs, accretion of debt premium/discount, net of debt extinguishment gain

 

320

 

 

 

377

 

Accretion of non-current liabilities

 

19

 

 

 

—

 

Other post-employment benefit plans expense

 

385

 

 

 

204

 

Income tax (recovery) expense

 

(4,286

)

 

 

4,007

 

Changes in working capital

 

13,788

 

 

 

(10,072

)

Contributions made to pension plans

 

(837

)

 

 

(731

)

Contributions made to other post-employment benefit plans

 

(207

)

 

 

(135

)

Provisions paid

 

(2,580

)

 

 

(2,938

)

Income taxes paid

 

(3,854

)

 

 

(831

)

 

 

22,603

 

 

 

11,018

 

 

 

 

 

Investing activities

 

 

 

Net cash consideration for acquisition of MCC

 

(130,953

)

 

 

—

 

Proceeds on sale and leaseback transaction

 

24,091

 

 

 

—

 

Purchase of property, plant and equipment

 

(2,419

)

 

 

(928

)

Purchase of intangible assets

 

(112

)

 

 

(75

)

Proceeds on disposal of property, plant and equipment

 

242

 

 

 

56

 

 

 

(109,151

)

 

 

(947

)

 

 

 

 

Financing activities

 

 

 

Issuance of common shares and broker warrants, net

 

24,221

 

 

 

—

 

Exercise of warrants

 

489

 

 

 

—

 

Exercise of options

 

751

 

 

 

—

 

Proceeds from credit facilities

 

155,640

 

 

 

5,900

 

Repayment of credit facilities

 

(65,260

)

 

 

(8,921

)

Decrease in restricted cash

 

—

 

 

 

515

 

Transaction costs

 

(1,802

)

 

 

—

 

Lease payments

 

(9,380

)

 

 

(6,574

)

 

 

104,659

 

 

 

(9,080

)

 

 

 

 

Change in cash and cash equivalents during the period

 

18,111

 

 

 

991

 

Cash and cash equivalents – beginning of period

$

4,208

 

 

$

901

 

Effects of foreign exchange on cash balances

 

(9

)

 

 

53

 

Cash and cash equivalents – end of period

$

22,310

 

 

$

1,945

 

1 Note: EBITDA, Adjusted EBITDA, Adjusted EBITDA as a percentage of revenues, Adjusted net income (loss) and Adjusted net income (loss) as a percentage of revenues are not earnings measures recognized by International Financial Reporting Standards (IFRS), do not have any standardized meanings prescribed by IFRS and might not be comparable to similar financial measures disclosed by other issuers. EBITDA, Adjusted EBITDA, Adjusted EBITDA as a percentage of revenues, Adjusted net income (loss) and Adjusted net income (loss) as a percentage of revenues should not be construed as alternatives to net income (loss) determined in accordance with IFRS as an indicator of DCM’s performance. For a description of the composition of EBITDA, Adjusted EBITDA, Adjusted EBITDA as a percentage of revenues, Adjusted net income (loss) and Adjusted net income (loss) as a percentage of revenues, why we believe such measures are useful to investors and how we use those measures in our business, together with a quantitative reconciliation of net income (loss) to EBITDA, Adjusted EBITDA and Adjusted net income (loss), respectively, see the information under the heading “Non-IFRS Measures” and the information set forth on Table 2 and Table 3, which information is incorporated by reference in this press release.

View source version on businesswire.com: https://www.businesswire.com/news/home/20231108363949/en/

Mr. Richard Kellam President and Chief Executive Officer DATA Communications Management Corp. Tel: (905) 791-3151

Mr. James E. Lorimer Chief Financial Officer DATA Communications Management Corp. Tel: (905) 791-3151 ir@datacm.com