DND Dye and Durham Limited

• ADJUSTED EBITDA GROWTH OF 267% TO $62.6 MILLION
  
  
• ACQUISITIONS ANNOUNCED IN DECEMBER SET THE STAGE FOR THE NEXT PHASE OF GROWTH

TORONTO, Feb. 1, 2022 /CNW/ - Dye & Durham Limited ("Dye & Durham" or the "Company") (TSX: DND), a leading provider of cloud-based software and technology solutions designed to improve efficiency and increase productivity for legal and business professionals, today announced its financial results for the three months ended December 31, 2021.

"We continue to deliver record growth in revenue and Adjusted EBITDA from our digital-infrastructure like assets," said Matt Proud, CEO of Dye & Durham. "We also continued to execute our "Build to a Billion" growth strategy during the quarter, acquiring high-quality EBITDA in businesses that share the essential nature of our existing technology while building scale and diversity within our business. The acquisition of Telus Financial Solutions strengthens our real estate business in Canada and adds new technology solutions that are essential to financial institutions in Canada. The agreement we entered to acquire Link Administration Holdings ("Link"), of Australia, adds significant scale and diversifies our revenue with more than 50% expected recurring revenue on a proforma basis."

Second Quarter Fiscal 2022 Highlights

• Revenue of $109.6 million, an increase of $75.9 million, or 225%, from the same period in the prior year, primarily due to increased revenue from the recent acquisitions that closed in the previous twelve months, and the realization of revenue synergies.
• Net income of $(4.0) million, an increase of $17.5 million from the same period in the prior year. The increase was primarily due to increased operational income as a result of increase in revenue.
• Adjusted EBITDA¹ of $62.6 million, an increase of $45.5 million or 267% from the same period in the prior year, primarily due to the realization of revenue synergies from the acquisitions.
• On December 21, 2021, the Company entered into an agreement to acquire all issued and outstanding shares of Link for cash consideration of approximately $3,200 million or AUD$5.50 per Link common share. The closing of the transaction is subject to customary conditions, including shareholder approval, antitrust and foreign investment approval and other regulatory approvals. The acquisition is expected to close in the third quarter of calendar year 2022.
• On December 6, 2021, the Company acquired TELUS' Financial Solutions Business ("TFSB") for total cash consideration of $500 million. TFSB provides leading digital infrastructure and technology solutions to the financial community across Canada.

Link Administration Update
Dye & Durham has submitted the major regulatory submissions with the relevant authorities in Australia, the UK, Europe and India related to its agreement to acquire Link. Dye & Durham and Link's management teams are working on the integration planning of the two companies and the acquisition remains on schedule to close in the third quarter of calendar 2022, or earlier.

The United Kingdom's Competition and Markets Authority ("CMA") review of TM Group Acquisition
On December 9, 2021, the CMA has taken a Phase 1 decision to refer the acquisition of TM Group for an in-depth Phase 2 merger investigation. The Phase 2 review process is expected to conclude by June 2022.

Regardless of the outcome of the investigation it is not expected to have a material adverse impact on the business.  

Quarterly Dividend

On February 1, 2022, the Board of Directors declared a quarterly dividend of $0.01875 per share to shareholders of record on March 1, 2022, payable on March 8, 2022.

Conference Call Notification 

The Company will hold a conference call to discuss its business on Tuesday, February 1, 2022, at 5:00 p.m. ET hosted by senior management. A question-and-answer session will follow the corporate update.

This call is being webcast and can be accessed by going to:

https://produceredition.webcasts.com/starthere.jsp?ei=1527053&tp_key=5a51d2ddd4

¹ Represents a non-IFRS measure. For the relevant definitions, see "Non-IFRS Financial Measures" section of this press release. Management believes non-IFRS measures, including EBITDA and Adjusted EBITDA provide supplementary information to IFRS measures used in assessing the performance of the business.

Please see the Company's most recent Management's Discussion and Analysis for a reconciliation of these measures to their nearest IFRS measure.

About Dye & Durham

Dye & Durham Limited is a leading provider of cloud-based software and technology solutions designed to improve efficiency and increase productivity for legal and business professionals. Dye & Durham provides critical information services and workflows, which clients use to manage their process, information and regulatory requirements. The Company has operations in Canada, the United Kingdom, Ireland and Australia and has a strong blue-chip customer base that includes law firms, financial service institutions, and government organizations.

Additional information can be found at www.dyedurham.com.

Non-IFRS Measures

This press release makes reference to certain non-IFRS measures. These measures are not recognized measures under IFRS, do not have a standardized meaning prescribed by IFRS and are therefore unlikely to be comparable to similar measures presented by other companies.

Rather, these measures are provided as additional information to complement those IFRS measures by providing further understanding of the Company's results of operations from management's perspective and to discuss Dye & Durham's financial outlook. Accordingly, these measures should not be considered in isolation nor as a substitute for analysis of Dye & Durham's financial information reported under IFRS. The Company uses non-IFRS measures including: "EBITDA" and "Adjusted EBITDA". 

EBITDA

EBITDA means net income (loss) before amortization and depreciation expenses, finance and interest costs, and provision for income taxes.

Adjusted EBITDA

Adjusted EBITDA adjusts EBITDA for stock-based compensation expense, asset impairment charges, loss on settlement of loans and borrowings, gains or losses from changes in fair value of derivative financial instruments and contingent consideration liabilities measured at fair value through profit or loss, specific transaction related expenses related to acquisitions, IPO and capital structure reorganization, operational restructuring costs, restructuring costs includes impact to the full year of cost synergies related to the reduction of employees in relation to acquisitions.

Forward-Looking Statements

This press release contains forward–looking information and forward-looking statements (collectively, "forward-looking information") within the meaning of applicable securities legislation, which reflect the Company's current expectations regarding future events. Particularly, information regarding the Company's expectations of future results, performance, prospects or the markets in which we operate is forward-looking information. In some cases, forward-looking information can be identified by the use of forward-looking terminology such as "forecast", "target", "goal", "may", "might", "will", "expect", "anticipate", "estimate", "intend", "plan", "indicate", "seek", "believe", "predict", or "likely", or the negative of these terms, or other similar expressions intended to identify forward-looking statements. In addition, any statements that refer to expectations, intentions, projections or other characterizations of future events or circumstances contain forward-looking information. Statements containing forward-looking information are not historical facts but instead represent management's expectations, estimates and projections regarding future events or circumstances. Such forward-looking information is necessarily based on a number of opinions, estimates and assumptions, including but not limited to those assumptions described under the heading "Caution Regarding Forward-Looking Information" in the Company's Management's Discussion & Analysis for the quarter ended September 30, 2021 (the "MD&A"). Forward-looking information is subject to and entirely qualified by known and unknown risks, uncertainties, assumptions and other factors that may cause the actual results or performance to be materially different from those expressed or implied by such forward-looking information, including but not limited to factors discussed under the heading "Risk Factors" in the Company's Annual Information Form dated September 28, 2021 and under the heading "Risks and Uncertainties" in the MD&A, which are available on the Company's profile on SEDAR at www.sedar.com. If any of these risks or uncertainties materialize, or if the opinions, estimates or assumptions underlying the forward-looking information prove incorrect, actual results or future events might vary materially from those anticipated in the forward-looking information. Accordingly, investors should not place undue reliance on forward-looking information, which speaks only as of the date made. The forward-looking information contained in this news release represents the Company's expectations as of the date of this news release, and are subject to change after such date and the Company disclaims any intention or obligation or undertaking to update or revise any forward-looking information whether as a result of new information, future events or otherwise, except as required under applicable securities laws.

In addition, Dye & Durham's guidance on revenue and Adjusted EBITDA is considered forward-looking information. The foregoing demonstrates Dye & Durham's objectives, which are not forecasts or estimates of its financial position, but are based on the implementation of its strategic goals, growth prospects and growth initiatives. Management's assessments of, and outlook for, revenue and Adjusted EBITDA set out herein are generally based on the following assumptions: (a) Dye & Durham's results of operations will continue as expected, (b) the Company will continue effectively execute against its key strategic growth priorities, (c) the Company will continue to retain and grow its existing customer base and market share, (d) the Company will be able to take advantage of future prospects and opportunities, and realize on related synergies, including in respect of acquisitions, (e) there will be no changes in legislative or regulatory matters that negatively impact Dye & Durham's business, (f) current tax laws will remain in effect and will not be materially changed, (g) economic conditions will remain relatively stable throughout the period, and (h) the industries Dye & Durham operates in will continue to grow consistent with past experience. The Company considers these assumptions to be reasonable in the circumstances, given the time period for such projections and targets. The achievement of target revenue set out above is subject to significant risks including: (a) that the Company will be unable to effectively execute against its key strategic growth priorities and (b) the Company will be unable to continue to retain and grow its existing customer base and market share. These estimates have been prepared by and are the responsibility of management. The Company's independent registered public accounting firm has not conducted a review of, and does not express an opinion or any other form of assurance with respect to, these estimates.

SOURCE Dye & Durham Limited