Enghouse Releases Fourth Quarter and Year End Results

Enghouse Releases Fourth Quarter and Year End Results Canada NewsWire MARKHAM, ON, Dec. 15, 2025 MARKHAM, ON, Dec. 15, 2025 /CNW/ - Enghouse Systems Limited (TSX: ENGH) announces its fourth quarter (unaudited) and audited year-end financial results for the period ended October 31, 2025. All figures are denominated in Canadian dollars unless otherwise indicated. Fourth Quarter and Annual Financial Highlights: Revenue was $124.5 million as compared to $125.7 million in the fourth quarter last year and for the fiscal year was $498.9 million compared to  $502.5 million last year; Recurring revenue, which includes SaaS and maintenance services, was $86.1 million compared to $88.2 million in Q4 2024, and represents 69.2% of total revenue. For the fiscal year, recurring revenue was $348.0 million compared to $346.6 million in the prior year, as we continue to prioritize this revenue stream; Results from operating activities were $31.0 million compared to $33.4 million in Q4 2024 and decreased in the fiscal year to $114.4 million from $133.8 million; Net income was $21.1 million compared to $22.6 million in Q4 2024 and $73.7 million in the fiscal year compared to $81.3 million last year; Adjusted EBITDA was $33.7 million compared to $35.6 million in Q4 2024, while achieving a 27.0% margin. Adjusted EBITDA was $127.6 million in the fiscal year compared to $143.8 million in the prior year, while achieving a 25.6% margin; Net cash provided by operating activities, excluding changes in working capital and income taxes paid, was $35.3 million compared to $40.3 million in Q4 2024 and $129.5 million for the fiscal year compared to $151.8 million in the prior year. Cash, cash equivalents and short-term investments were $269.1 million as at October 31, 2025. Fiscal 2025 unfolded amid significant economic, technological, and geopolitical shifts, including a rapidly evolving AI landscape and heightened global uncertainty from tariffs. Despite these conditions, Enghouse delivered steady performance and continued progress on strategic priorities. Revenue remained stable at $498.9 million, supported by a diversified portfolio and a recurring revenue base representing approximately 69% of total revenue, providing predictability and insulation from broader market volatility. Throughout the year, the Company emphasized operational discipline and efficiency, advancing restructuring and cost-alignment initiatives to maintain profitability. These actions contributed to improving adjusted EBITDA in the fourth quarter and are expected to support further benefits in the coming year. Enghouse generated strong net cash provided by operating activities and maintained a robust financial position, closing the year with $269.1 million in cash and no external debt. Capital was deployed toward shareholder returns through dividends and share repurchases, as well as into three strategic acquisitions that expanded geographic reach and strengthened transportation product capabilities in communications and mobility solutions. Subsequent to year-end, the Company acquired Sixbell Telco's telecommunications division, expanding its presence in the Latin American market. Sixbell Telco provides a comprehensive suite of software platforms that enable service providers to modernize and transform their networks. Looking ahead to fiscal 2026, Enghouse remains focused on strengthening its recurring revenue base, advancing operational efficiency, and pursuing acquisitions in an environment that offers attractive opportunities. With a flexible solution portfolio, disciplined cost management and a strong cash position, the Company is well positioned to navigate ongoing volatility while delivering predictable performance and long-term shareholder value. Quarterly dividends: Today, the Board of Directors approved the Company's eligible quarterly dividend of $0.30 per common share payable on February 27, 2026 to shareholders of record at the close of business on February 13, 2026. Enghouse Systems Limited Financial Highlights (Unaudited, in thousands of Canadian dollars)    For the period ended October 31 Three months (Unaudited) Twelve months 2025 2024  Var ($) Var (%) 2025 2024 Var ($) Var (%) Revenue $ 124,482 $ 125,702 (1,220) (1.0) $ 498,878 $ 502,505 (3,627) (0.7) Direct costs 45,728 44,967 761 1.7 181,585 175,586 5,999 3.4 Revenue, net of direct costs $ 78,754 $ 80,735 (1,981) (2.5) $ 317,293 $ 326,919 (9,626) (2.9) As a % of revenue 63.3 % 64.2 % 63.6 % 65.1 % Operating expenses 47,160 47,133 27 0.1 197,867 191,464 6,403 3.3 Special charges 572 169 403 238.5 5,072 1,609 3,463 215.2 Results from operating activities $ 31,022 $ 33,433 (2,411) (7.2) $ 114,354 $ 133,846 (19,492) (14.6) As a % of revenue 24.9 % 26.6 % 22.9 % 26.6 % Amortization of acquired software and customer relationships (6,685) (9,322) 2,637 28.3 (29,492) (40,505) 11,013 27.2 Foreign exchange (losses) gains (145) 1,870 (2,015) 107.8 (2,378) (1,680) (698) (41.5) Interest expense – lease obligations (114) (126) 12 9.5 (505) (556) 51 9.2 Finance income 2,017 2,825 (808) (28.6) 8,041 10,121 (2,080) (20.6) Finance expenses (55) (8) (47) (587.5) (98) (49) (49) (100.0) Other (expense) income (8) (424) 416 98.1 1,617 89 1,528 1716.9 Income before income taxes $ 26,032 $ 28,248 (2,216) (7.8) $ 91,539 $ 101,266 (9,727) (9.6) Provision for income taxes 4,904 5,607 (703) (12.5) 17,873 19,938 (2,065) (10.4) Net Income for the period $ 21,128 $ 22,641 (1,513) (6.7) $ 73,666 $ 81,328 (7,662) (9.4) Basic earnings per share 0.38 0.41 (0.03) (7.3) 1.34 1.47 (0.13) (8.8) Diluted earnings per share 0.38 0.41 (0.03) (7.3) 1.34 1.47 (0.13) (8.8) Net cash provided by operating activities 19,627 31,583 (11,956) (37.9) 104,634 132,071 (27,437) (20.8) Net cash provided by operating activities excluding changes in    working capital and income taxes paid 35,325 40,270 (4,945) (12.3) 129,503 151,803 (22,300) (14.7) Adjusted EBITDA Results from operating activities 31,022 33,433 (2,411) (7.2) 114,354 133,846 (19,492) (14.6) Depreciation 624 655 (31) (4.7) 2,518 2,347 171 7.3 Depreciation of right-of-use assets 1,443 1,375 68 4.9 5,644 5,981 (337) (5.6) Special charges 572 169 403 238.5 5,072 1,609 3,463 215.2 Adjusted EBITDA $ 33,661 $ 35,632 (1,971) (5.5) $ 127,588 $ 143,783 (16,195) (11.3) Adjusted EBITDA margin 27.0 % 28.3 % 25.6 % 28.6 % Adjusted EBITDA per diluted share $ 0.61 $ 0.64 ( 0.03) (4.7) $ 2.31 $ 2.60 ( 0.29) (11.2) Enghouse Systems Limited Consolidated Statements of Financial Position (in thousands of Canadian dollars)     As at October 31, 2025 As at October 31, 2024 ASSETS Current assets:    Cash and cash equivalents $ 269,061 $ 274,240    Short-term investments 25 487    Accounts receivable 88,980 92,348    Prepaid expenses and other assets 17,001 16,100 375,067 383,175 Non-current assets:    Property and equipment 3,890 4,192    Right-of-use assets 11,453 11,473    Intangible assets 89,710 98,594    Goodwill 341,593 309,831    Deferred income tax assets 35,105 26,228 481,751 450,318 $ 856,818 $ 833,493 LIABILITIES AND SHAREHOLDERS' EQUITY Current liabilities:    Accounts payable and accrued liabilities $ 76,167 $ 70,087    Income tax payable 10,662 5,525    Dividends payable 16,426 14,397    Provisions 2,013 1,834    Deferred revenue 108,268 114,080    Lease obligations 5,197 5,344 218,733 211,267 Non-current liabilities:    Deferred income tax liabilities 13,439 10,500    Deferred revenue 6,791 8,094    Net employee defined benefit obligation 2,442 2,081    Lease obligations 5,944 5,744 28,616 26,419 247,349 237,686   Shareholders' equity    Share capital 116,894 118,217    Contributed surplus 11,110 9,764    Retained earnings 443,134 446,748    Accumulated other comprehensive income 38,331 21,078 609,469 595,807 $ 856,818 $ 833,493 Enghouse Systems Limited Consolidated Statement of Operations and Comprehensive Income (in thousands of Canadian dollars, except per share amounts) Three months Twelve months Periods ended October 31 2025 (Unaudited) 2024 (Unaudited) 2025 2024   Revenue      Software licenses $  15,480 $  15,860 $  67,436 $  72,906      SaaS and maintenance services 86,121 88,196 347,995 346,579      Professional services 17,349 18,469 68,238 70,046      Hardware 5,532 3,177 15,209 12,974 124,482 125,702 498,878 502,505 Direct costs      Software licenses 673 397 2,752 3,501      Services 43,019 43,043 172,357 165,221      Hardware 2,036 1,527 6,476 6,864 45,728 44,967 181,585 175,586 Revenue, net of direct costs 78,754 80,735 317,293 326,919 Operating expenses      Selling, general and administrative 21,267 22,642 93,635 94,303      Research and development 23,826 22,461 96,070 88,833      Depreciation 624 655 2,518 2,347      Depreciation of right-of-use assets 1,443 1,375 5,644 5,981      Special charges 572 169 5,072 1,609 47,732 47,302 202,939 193,073 Results from operating activities 31,022 33,433 114,354 133,846 Amortization of acquired software and customer relationships    (6,685) (9,322) (29,492) (40,505) Foreign exchange (losses) gains (145) 1,870 (2,378) (1,680) Interest expense – lease obligations (114) (126) (505) (556) Finance income 2,017 2,825 8,041 10,121 Finance expenses (55) (8) (98) (49) Other (expense) income (8) (424) 1,617 89 Income before income taxes 26,032 28,248 91,539 101,266 Provision for income taxes 4,904 5,607 17,873 19,938 Net income for the period $  21,128 $  22,641 $  73,666 $  81,328   Items that may be subsequently reclassified to income: Cumulative translation adjustment 8,938 2,882 17,253 10,249 Other comprehensive income 8,938 2,882 17,253 10,249 Comprehensive income $    30,066 $  25,523 $  90,919 $  91,577 Earnings per share Basic $        0.38 $      0.41 $      1.34 $      1.47 Diluted $        0.38 $      0.41 $      1.34 $      1.47 Enghouse Systems Limited Consolidated Statements of Cash Flows (in thousands of Canadian dollars) Three months Twelve months Periods ended October 31 2025 (Unaudited) 2024 (Unaudited) 2025 2024   OPERATING ACTIVITIES Net income for the period $    21,128 $    22,641 $    73,666 $    81,328 Adjustments for non-cash items    Depreciation 624 655 2,518 2,347    Depreciation of right-of-use assets 1,443 1,375 5,644 5,981    Interest expense – lease obligations 114 126 505 556    Amortization of acquired software and customer relationships 6,685 9,322 29,492 40,505    Stock-based compensation expense 364 112 1,324 1,188    Provision for income taxes 4,904 5,607 17,873 19,938    Finance expenses and other (income) expense 63 432 (1,519) (40) 35,325 40,270 129,503 151,803 Changes in non-cash operating working capital (10,031) (7,674) (6,361) (7,920) Income taxes paid (5,667) (1,013) (18,508) (11,812) Net cash provided by operating activities 19,627 31,583 104,634 132,071 INVESTING ACTIVITIES Purchase of property and equipment, net (300) (516) (1,479) (1,977) Acquisitions, net of cash acquired* - - (33,399) (43,448) Proceeds from sale of short-term investments 75 - 75 - Recovery of purchase consideration for prior-year acquisitions - - - 171 Net cash used in investing activities ( 225) ( 516) (34,803) (45,254) FINANCING ACTIVITIES Issuance of share capital - 2,990 - 9,085 Normal course issuer bid share repurchases (7,213) (3,088) (14,742) (5,994) Repayment of lease obligations (1,304) (1,283) (6,074) (7,030) Dividends paid (16,526) (14,397) (61,810) (53,139) Net cash used in financing activities (25,043) (15,778) (82,626) (57,078)   Impact of foreign exchange on cash and cash equivalents 3,221 1,238 7,616   4,969 (Decrease) increase in cash and cash equivalents (2,420) 16,527 (5,179) 34,708 Cash and cash equivalents - beginning of period 271,481 257,713 274,240 239,532 Cash and cash equivalents - end of period $  269,061 $  274,240 $  269,061 $  274,240 * Acquisitions are net of cash acquired of nil and $9,287 for the quarter and year ended October 31, 2025, respectively and nil and $742 for the quarter and year ended October 31, 2024, respectively. Enghouse Systems Limited Segment Reporting Information (in thousands of Canadian dollars) For the period ended October 31, 2025 Three months (Unaudited) Twelve months IMG AMG Total IMG AMG Total Revenue $ 68,795 $ 55,687 $ 124,482 $ 285,760 $ 213,118 $ 498,878 Direct costs (23,787) (21,941) (45,728) (100,133) (81,452) (181,585) Revenue, net of direct costs 45,008 33,746 78,754 185,627 131,666 317,293 Operating expenses excluding special charges (21,232) (14,432) (35,664) (90,066) (55,625) (145,691) Depreciation (290) (334) (624) (1,441) (1,077) (2,518) Depreciation of right-of-use assets (867) (576) (1,443) (3,568) (2,076) (5,644) Segment profit $ 22,619 $ 18,404 $ 41,023 $ 90,552 $ 72,888 $ 163,440 Special charges (572) (5,072) Corporate and shared service expenses (9,429) (44,014) Results from operating activities $ 31,022 $ 114,354   For the period ended October 31, 2024 Three months (Unaudited) Twelve months IMG AMG Total IMG AMG Total Revenue $ 74,731 $ 50,971 $ 125,702 $ 308,920 $ 193,585 $ 502,505 Direct costs (25,900) (19,067) (44,967) (102,390) (73,196) (175,586) Revenue, net of direct costs 48,831 31,904 80,735 206,530 120,389 326,919 Operating expenses excluding special charges (21,235) (13,071) (34,306) (90,871) (47,238) (138,109) Depreciation (416) (239) (655) (1,574) (773) (2,347) Depreciation of right-of-use assets (940) (435) (1,375) (3,870) (2,111) (5,981) Segment profit $ 26,240 $ 18,159 $ 44,399 $ 110,215 $ 70,267 $ 180,482 Special charges (169) (1,609) Corporate and shared service expenses (10,797) (45,027) Results from operating activities $ 33,433 $ 133,846 About-Enghouse Enghouse Systems Limited is a Canadian publicly traded company (TSX: ENGH) that provides mission-critical vertically focused enterprise software solutions. Our core technologies are used for contact centers, video communications, virtual healthcare, education, telecommunications, networks, IPTV, public safety and transit. The Company's two-pronged strategy to grow earnings focuses on both organic growth and acquisitions, which, to date, have been funded through net cash provided by operating activities as the Company has no external debt financing. The Company is organized around two business segments, the Interactive Management Group ("IMG") and the Asset Management Group ("AMG") due to their unique customer segments and technology offerings. Further information about Enghouse may be obtained from the Company's website at www.enghouse.com.  Conference Call and Webcast A conference call to discuss the results will be held on Tuesday, December 16, 2025 at 8:45 a.m. EST. To participate, please call +1-289-514-5100 or North American Toll-Free +1-800-717-1738. Confirmation code: 17364 A webcast is also available at: https://www.enghouse.com/investors.php. The Company uses non-IFRS measures to assess its operating performance. Securities regulations require that companies caution readers that earnings and other measures adjusted to a basis other than IFRS do not have standardized meanings and are unlikely to be comparable to similar measures used by other companies. Accordingly, they should not be considered in isolation. The Company uses Adjusted EBITDA, Adjusted EBITDA margin and Adjusted EBITDA per diluted share as measures of operating performance. Therefore, these collective Adjusted EBITDA measures may not be comparable to similar measures presented by other issuers. Adjusted EBITDA is calculated based on results from operating activities adjusted for depreciation of property and equipment and right-of-use assets and special charges for acquisition related restructuring costs. Management uses Adjusted EBITDA to evaluate operating performance as it excludes amortization of software and intangibles (which is an accounting allocation of the cost of software and intangible assets arising on acquisition), any impact of finance and tax related activities, asset depreciation, foreign exchange gains and losses, other income and restructuring costs. SOURCE Enghouse Systems Limited View original content: http://www.newswire.ca/en/releases/archive/December2025/15/c4134.html Contact: For further information please contact: Sam Anidjar, Vice President, Corporate Development, Tel: (905) 946-3200, Email: [email protected]