DATA Communications Management Corp. Reports Q1 2026 Financial Results

About this update from Data Communications Management Corp.

FIRST QUARTER 2026 SUMMARY FINANCIAL RESULTS Revenues of $117.4 million were down 5.0%, or $6.2 million vs. $123.7 million in Q1 2025 Adjusted EBITDA 1 increased to $19.1 million and 16.3% of revenues vs. $18.6 million and 15.0% of revenues in Q1 2025 SG&A expenses of $19.8 million and 16.9% of revenues, were 15.4% lower, vs. $23.5 million or 19.0% of revenues in Q1 2025 Net income of $4.8 million, vs. $5.1 million in Q1 2025 and Adjusted net income 1 of $5.8 million, vs. $5.2 million in Q1 2025 Basic earnings per share of $0.09 (diluted EPS of $0.08), compared to $0.09 in Q1 2025 (diluted EPS of $0.09) Net debt 1 at quarter-end of $66.4 million, down 27.0%, or $24.5 million vs. $90.8 million in Q1 2025 and down 14.0%, or $10.8 million vs. $77.1 million in Q4 2025 Company repurchased 157,500 common shares during the first quarter of 2026 Company declares quarterly dividend of $0.025 on each common share Brampton, Ontario--(Newsfile Corp. - May 11, 2026) - DATA Communications Management Corp. (TSX: DCM) (OTCQX: DCMDF) ("DCM" or the "Company"), a leading Canadian provider of print and digital solutions that help simplify complex marketing communications and workflow, today reported first quarter 2026 financial results. MANAGEMENT COMMENTARY "A slower-than-anticipated start to the year contributed to the decline in revenues, however, performance improved as the quarter progressed, and we exited the quarter with positive momentum. We remained focused on controlling what we can - generating positive cash flow from operations, managing overhead, and maintaining balance sheet discipline. Adjusted EBITDA increased year-over-year for the first time in four quarters, up 2.7% compared to Q1 2025, reflecting disciplined management of SG&A expenses," said Richard Kellam, President & CEO of DCM. "We are pleased to see an increasing contribution from our new business development efforts and continue to see increasing contributions from technology-driven revenue streams, including customer communications management solutions, with tech-enabled subscription services and fees increasing 7.4% year over year to $6.9 million," added Kellam. "Looking ahead to the balance of the year, we anticipate continued uncertainty in the external environment amid concerns about trade policy volatility, geopolitical unrest driving higher production costs, and the potential for further labour disruptions at Canada Post. Despite this uncertainty, we remain confident that our business development efforts, strong balance sheet and disciplined cost management will offset potential financial headwinds." DCM continues to be guided by four strategic priorities for 2026: Maintain a high revenue retention rate and execute on new business development. Improve gross margin through business mix, operational efficiencies and digital acceleration. Generate strong cash flow for continued capital returns and debt repayment. Leverage the current market environment to be opportunistic on M&A.  OTHER BUSINESS HIGHLIGHTS Increase in CEO Share Ownership On April 15, 2026, the Company announced that Richard Kellam exercised 2,500,000 stock options (each, an "Option") and acquired 1,394,231 common shares in the capital of the Company (each, a "Common Share"). The Options were exercised at an exercise price of $0.69 per Common Share on a net-settlement (cashless) basis. Following exercise of the Options, Mr. Kellam owns approximately 3.8% of the issued and outstanding Common Shares of the Company (as at April 10, 2026). Dividend Declaration On May 11, 2026, DCM's board of directors declared a sixth quarterly dividend of $0.025 per common share, payable on June 30, 2026, to shareholders of record at the close of business on June 16, 2026. This dividend is designated as an "eligible" dividend for the purpose of the Income Tax Act (Canada) and any similar provincial legislation. Q1 2026 EARNINGS CALL DETAILS The Company will host a conference call and webcast on Tuesday, May 12, 2026 at 9:00 a.m. EST Richard Kellam, President and CEO, and James Lorimer, CFO, will present the first quarter 2026 results followed by a live Q&A. Register for the webcast prior to the start of the event: Microsoft Virtual Events Powered by Teams All attendees must register for the webinar prior to the call. Please complete the phone field in the form at the above link (prior to the start of the event) if you wish to dial in. The Company's full results will be posted on its Investor Relations page and on SEDAR+. Footnotes: 1 Adjusted EBITDA, Adjusted EBITDA as a percentage of revenues, Adjusted net income (loss), Adjusted net income (loss) as percentage of revenues, Net debt, Net debt to Adjusted EBITDA and Free cash flow are non-IFRS Accounting Standards measures. For a description of the composition of these and other non-IFRS Accounting Standards measures used in this press release, and a reconciliation to their most comparable IFRS Accounting Standards measure, where applicable, see the information under the heading "Non-IFRS Accounting Standards Measures", the information set forth on Table 2 and Table 3 herein, and our most recent Management Discussion & Analysis filed on SEDAR+.  TABLE 1 The following table sets out selected historical consolidated financial information for the periods noted. For the three months ended March 31, 2026, December 31, 2025 and March 31, 2025 (in thousands of Canadian dollars, except share and per share amounts, unaudited) March 31, 2026 December 31, 2025 March 31, 2025 Revenues $ 117,443 $ 107,518 $ 123,675       Gross profit 33,150 25,285 36,260       Gross profit, as a percentage of revenues 28.2 % 23.5 % 29.3 %       Selling, general and administrative and research and development expenses 19,843 19,362 23,459 As a percentage of revenues 16.9 % 18.0 % 19.0 %       Adjusted EBITDA 19,091 12,790 18,588 As a percentage of revenues 16.3 % 11.9 % 15.0 %       Net income for the period 4,789 (634 ) 5,114       Adjusted net income 5,783 729 5,203 As a percentage of revenues 4.9 % 0.7 % 4.2 %       Basic earnings per share $ 0.09 $ (0.01 ) $ 0.09 Diluted earnings per share $ 0.08 $ (0.01 ) $ 0.09 Adjusted net income per share, basic $ 0.11 $ 0.01 $ 0.09 Adjusted net income per share, diluted $ 0.10 $ 0.01 $ 0.09                     Weighted average number of common shares outstanding, basic 54,990,543 55,037,637 55,308,951                     Weighted average number of common shares outstanding, diluted 56,429,002 56,429,403 57,337,772   TABLE 2 The following table provides reconciliations of net income to EBITDA and of net income to Adjusted EBITDA for the periods noted. EBITDA and Adjusted EBITDA reconciliation For the periods ended March 31, 2026 and 2025 January 1 to  March 31, 2026 January 1 to  March 31, 2025 (in thousands of Canadian dollars, unaudited) Net income for the period $ 4,789 $ 5,114     Interest expense, net 4,697 5,148 Amortization of transaction costs 206 140 Current income tax expense 2,285 2,071 Deferred income tax recovery (1,099 ) (911 ) Depreciation of property, plant and equipment 1,659 1,722 Amortization of intangible assets 319 383 Depreciation of the ROU Asset 4,906 4,802 EBITDA $ 17,762 $ 18,469 Acquisition and integration costs — — Restructuring expenses 1,427 — Net fair value losses on financial liabilities at fair value through profit or loss (98 ) 119 Adjusted EBITDA $ 19,091 $ 18,588   TABLE 3 The following table provides reconciliations of net income (loss) 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 March 31, 2026 and 2025 January 1 to  March 31, 2026 January 1 to  March 31, 2025 (in thousands of Canadian dollars, except share and per share amounts, unaudited) Net income for the period $ 4,789 $ 5,114     Acquisition and integration costs — — Restructuring expenses 1,427 — Net fair value losses on financial liabilities at fair value through profit or loss (98 ) 119 Tax effect of the above adjustments (335 ) (30 ) Adjusted net income $ 5,783 $ 5,203   About DATA Communications Management Corp. DCM is a leading Canadian tech-enabled provider of print and digital solutions that help simplify complex marketing communications and operations workflow. DCM serves over 2,500 clients including 70 of the 100 largest Canadian corporations and leading government agencies. Our core strength lies in delivering individualized services to our clients that simplify their communications, including customized printing, highly personalized marketing communications, campaign management, digital signage, and digital asset management. From omnichannel marketing campaigns to large-scale print and digital workflows, our goal is to make complex tasks surprisingly simple, allowing our clients to focus on what they do best. 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 SEDAR+ at www.sedarplus.ca . For further information, contact Mr. Richard Kellam Mr. James E. Lorimer President and Chief Executive Officer Chief Financial Officer     DATA Communications Management Corp. DATA Communications Management Corp. Tel: (905) 791-3151 Tel: (905) 791-3151 [email protected]   FORWARD-LOOKING STATEMENTS This press release contains statements which constitute "forward-looking statements" and "forward-looking information" within the meaning of applicable securities laws (collectively, "forward-looking statements"), including statements regarding the plans, intentions, beliefs and current expectations of the Company with respect to future business activities and operating performance. Forward-looking statements are often identified by the words "may", "would", "could", "should", "will", "intend", "plan", "anticipate", "believe", "estimate", "expect" or similar expressions and forward-looking statements in this press release. 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. They 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. We caution readers of this press release not to place undue reliance on our forward-looking statements since a number of factors could cause actual future results, conditions, actions, or events to differ materially from the targets, expectations, estimates or intentions expressed in these 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 are described in further detail in our most recent Annual Information Form filed on SEDAR+, and include but are not limited to the following: industry conditions are influenced by numerous factors over which the Company has no control, including: declines in print consumption; labour disruptions at suppliers and customers, including Canada Post; the impact of tariffs and responses thereto (including by governments, trade partners and customers), which may include, without limitation, retaliatory tariffs, export taxes, restrictions on exports to the U.S. or other measures, increases in our input costs, and the effect of governmental regulations and policies in general; our ability to achieve and meet our revenue, profitability, free cash flow and debt reduction targets for 2026 and in the future; and our ability to retain key personnel. 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 ACCOUNTING STANDARDS MEASURES NON-IFRS ACCOUNTING STANDARDS AND OTHER FINANCIAL MEASURES This press release includes certain non-IFRS Accounting Standards measures, ratios and other financial measures as supplementary information. This supplementary information does not represent earnings measures recognized by IFRS Accounting Standards and does not have any standardized meanings prescribed by IFRS Accounting Standards. Therefore, these non-IFRS Accounting Standards measures, ratios and other financial measures are unlikely to be comparable to similar measures presented by other issuers. Investors are cautioned that this supplementary information should not be construed as alternatives to net income (loss) determined in accordance with IFRS Accounting Standards as an indicator of DCM's performance. Definitions of such supplementary information, together with a reconciliation of net income (loss) to such supplementary financial measures, can be found in our most recent annual and interim Management Discussion and Analysis and filed on SEDAR+ at www.sedarplus.ca . Condensed interim consolidated statements of financial position   (in thousands of Canadian dollars, unaudited) March 31, 2026 December 31, 2025 $ $     Assets     Current assets     Cash and cash equivalents $ 6,035 $ 1,941 Trade receivables 97,986 95,745 Inventories 20,449 19,272 Prepaid expenses and other current assets 6,333 4,899 Income taxes receivable — 245 130,803 122,102 Non-current assets     Other non-current assets 1,820 2,068 Deferred income tax assets 10,035 9,180 Property, plant, and equipment 32,118 32,045 Right-of-use assets 153,448 158,452 Pension assets 4,603 4,269 Intangible assets 6,753 7,072 Goodwill 22,747 22,747 $ 362,327 $ 357,935     Liabilities     Current liabilities     Trade payables and accrued liabilities $ 51,187 $ 43,822 Dividend payable 1,407 — Current portion of credit facilities 11,464 11,856 Current portion of lease liabilities 12,658 12,228 Provisions 2,650 2,350 Income taxes payable 536 — Deferred revenue 4,184 3,918 84,086 74,174 Non-current liabilities     Provisions 116 215 Credit facilities 59,390 65,470 Lease liabilities 161,392 163,982 Pension obligations 11,202 11,862 Other post-employment benefit plans 1,242 1,268 Asset retirement obligation 3,577 3,548 $ 321,005 $ 320,519     Equity     Shareholders' equity     Shares $ 283,950 $ 284,206 Contributed surplus 2,798 2,806 Translation Reserve 244 192 Deficit (245,670 ) (249,788 ) $ 41,322 $ 37,416 $ 362,327 $ 357,935   Condensed interim consolidated statements of operations (in thousands of Canadian dollars, except per share amounts, unaudited) For the three months ended March 31, 2026 For the three months ended March 31, 2025 $ $ Revenues $ 117,443 $ 123,675     Cost of revenues 84,293 87,415     Gross profit 33,150 36,260     Expenses     Selling, commissions and expenses 10,425 10,960 General and administration expenses 9,418 12,499 Research and development expenses 1,100 1,120 Restructuring expenses 1,427 — Net fair value losses on financial liabilities at fair value through profit or loss (98 ) 119 22,272 24,698     Income before finance costs and income taxes 10,878 11,562     Finance costs     Interest expense on long term debt and pensions, net 1,436 1,871 Interest expense on lease liabilities 3,261 3,277 Amortization of transaction costs 206 140 4,903 5,288     Income before income taxes 5,975 6,274     Income tax expense     Current 2,285 2,071 Deferred (1,099 ) (911 ) 1,186 1,160     Net income for the period $ 4,789 $ 5,114     Other comprehensive income:     Items that may be reclassified subsequently to net income     Foreign currency translation 52 (5 ) 52 (5 ) Items that will not be reclassified to net income     Re-measurements of pension and other post-employment benefit obligations 986 (385 ) Taxes related to pension and other post-employment benefit adjustment above (250 ) 98 736 (287 )     Other comprehensive income (loss) for the period, net of tax $ 788 $ (292 )     Comprehensive income for the period $ 5,577 $ 4,822     Basic earnings per share 0.09 0.09 Diluted earnings per share 0.08 0.09   Condensed interim consolidated statements of cash flows (in thousands of Canadian dollars, unaudited) For the three months ended March 31, 2026 For the three months ended March 31, 2025 $ $     Cash provided by         Operating activities     Net income for the period $ 4,789 $ 5,114 Items not affecting cash     Depreciation of property, plant, and equipment 1,659 1,722 Amortization of intangible assets 319 383 Depreciation of right-of-use assets 4,906 4,802 Share-based compensation expense — 70 Net fair value losses on financial liabilities at fair value through profit or loss (98 ) 119 Pension expense 286 372 Gain on disposal of property, plant, and equipment 3 — Provisions 1,427 — Amortization of transaction costs 206 140 Accretion of asset retirement obligations 29 28 Other post-employment benefit plans expense 60 43 Income tax expense 1,186 1,160 Changes in non cash working capital 2,661 (12,263 ) Contributions made to pension plans (294 ) (355 ) Contributions made to other post-employment benefit plans (86 ) (108 ) Provisions paid (1,226 ) (4,002 ) Income taxes (paid) received (1,504 ) (1,400 ) Total cash (used in) generated from operating activities 14,323 (4,175 )     Investing activities     Proceeds on sale and leaseback transaction — 6,694 Purchase of property, plant, and equipment (1,735 ) (1,489 ) Purchase of non-current assets — (143 ) Total cash provided by investing activities (1,735 ) 5,062     Financing activities     Proceeds from credit facilities 15,000 32,232 Repayment of credit facilities (21,678 ) (18,873 ) Decrease in bank overdrafts — (880 ) Transaction costs — (4 ) Dividends paid — (11,063 ) Principal portion of lease payments (1,888 ) (1,775 ) Repurchases of shares (264 ) — Total cash (used in) financing activities (8,830 ) (363 )     Change in cash and cash equivalents during the period 3,758 524 Effects of foreign exchange on cash balances 52 (13 ) January 1, 2026 opening balance prior to restatement for IFRS 9 amendments 1,941 — Adjustment on adoption of IFRS 9 amendments for 2025 outstanding cheques on January 1, 2026 (note 3) 284 — Cash and cash equivalents - beginning of period 2,225 6,773 Cash and cash equivalents - end of period $ 6,035 $ 7,284   To view the source version of this press release, please visit https://www.newsfilecorp.com/release/296936 Condensed interim consolidated statements of cash flows

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