Dye & Durham reported strong financial performance with significant growth in ARR and the Financial Solutions division. However, challenges were noted with the ongoing Competition Bureau investigation and increased direct costs impacting margins. The company's transition to a contracted revenue model and reduction in net debt were positives, but concerns remain with the investigation and cost pressures.

Company Guidance

During the Dye & Durham Q1 2025 earnings call, several key metrics were discussed, reflecting the company's financial performance and strategic direction. The company reported a revenue of $120 million and an adjusted EBITDA of $66 million for the first quarter, alongside a robust annual recurring revenue (ARR) of $156 million, marking a 43% growth year-over-year. Organic growth was noted at over 5% for the quarter, and the churn rate remained low at under 4%. The financial services division contributed over 20% to the total revenue, with the company highlighting strong relationships with over 100 financial institutions in Canada and Australia. Additionally, leveraged free cash flow was reported at $28.2 million, showing an improvement of $34.5 million from the previous year. Despite challenges such as a Competition Bureau investigation, Dye & Durham maintained confidence in its business integrity and continued to focus on organic growth and debt reduction.

Strong Financial Performance

Dye & Durham reported $120 million in revenue and $66 million in adjusted EBITDA for Q1 2025. Revenue grew by 5% compared to the prior year, and annual recurring revenue (ARR) reached $156 million, marking a 43% year-over-year growth.

Growth in Financial Solutions Division

The Financial Solutions division saw over 20% year-over-year revenue growth and now represents over 20% of Dye & Durham's global revenue. The division has secured long-term contracts with major financial institutions.

Successful Transition to Contracted Revenue Model

Dye & Durham's transition from a transactional-based business to a contracted revenue model is paying off, with 54% of revenue now consisting of annual contracted revenue.

Reduction in Net Debt

Net debt was reduced by approximately $49 million since June 30, 2024, and a voluntary payment of $20 million was made towards the term loan facility.

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Dye & Durham (TSE:DND) Earnings, Revenues Date & History

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TSE:DND Earnings History

Report Date	Fiscal Quarter	Forecast / EPS	Last Year's EPS	EPS YoY Change	Slides	Play Transcript
Sep 22, 2020	2020 (Q4)	- / -0.18	0.039	-561.54% (-0.22)	―	―
Nov 10, 2020	2021 (Q1)	- / -0.38	-0.105	-261.90% (-0.28)	―	―
Feb 14, 2021	2021 (Q2)	- / -0.41	-0.035	-1071.43% (-0.38)	―	―
May 12, 2021	2021 (Q3)	0.13 / -0.16	-0.05	-220.00% (-0.11)	―	―
Aug 23, 2021	2021 (Q4)	0.24 / 0.09	-0.18	150.00% (+0.27)	―	―
Nov 08, 2021	2022 (Q1)	0.21 / 0.29	-0.38	176.32% (+0.67)	―	―
Feb 01, 2022	2022 (Q2)	-0.01 / -0.06	-0.41	85.37% (+0.35)	―	―
May 12, 2022	2022 (Q3)	0.01 / -0.10	-0.16	37.50% (+0.06)	―	―
Sep 26, 2022	2022 (Q4)	0.14 / -0.05	0.09	-155.56% (-0.14)	―	―
Nov 10, 2022	2023 (Q1)	0.14 / -0.15	0.29	-151.72% (-0.44)	―	―

The table shows recent earnings report dates and whether the forecast was beat or missed. See the change in forecast and EPS from the previous year.

Beat

Missed

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TSE:DND Earnings-Related Price Changes

Report Date	Price 1 Day Before	Price 1 Day After	Percentage Change
Nov 07, 2024	C$19.72	C$17.26	-12.47%
Sep 04, 2024	C$13.96	C$13.27	-4.94%
May 14, 2024	C$14.10	C$13.72	-2.70%
Feb 13, 2024	C$13.51	C$12.14	-10.14%

Earnings announcements can affect a stock’s price. This table shows the stock's price the day before and the day after recent earnings reports, including the percentage change.

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