Yellow Pages Limited Reports Second Quarter 2025 Financial and Operating Results and Declares a Cash Dividend (1)

Executive Summary

• Yellow Pages Limited reported its financial and operating results for the second quarter and six months ended June 30, 2025, alongside the declaration of a quarterly cash dividend.
• The company reported a decline in revenues and profitability compared to the prior year, driven by decreases in both digital and print product margins, though the rate of revenue decline improved sequentially.
• Key operational highlights include a "bending of the revenue curve" for the sixth consecutive quarter, a strong cash balance of approximately $49 million, and the completion of a $210 million group annuity contract purchase to derisk the pension plan.

Key Details

• Financial Results (Q2 2025 vs Q2 2024):
  • Revenues: $51.7 million (down 7.4% YoY); Six-month revenues were $102.5 million (down 7.5% YoY).
  • Adjusted EBITDA: $10.7 million (20.7% margin) for Q2, down from $14.8 million (26.5% margin) in Q2 2024. Six-month Adjusted EBITDA was $22.6 million.
  • Net Income: $1.5 million ($0.11 diluted EPS) for Q2, down from $7.6 million ($0.55 diluted EPS) in Q2 2024.
  • Cash Flow: Operating cash flows were $12.1 million for Q2, down from $13.7 million in Q2 2024.
  • CAPEX: $0.3 million for Q2, down from $0.7 million in Q2 2024.
• Operational Metrics:
  • Digital Revenues: $41.0 million (down 6.4% YoY), driven by a decrease in customer count partially offset by increased average spend per customer.
  • Print Revenues: $10.7 million (down 11.2% YoY), driven by a decrease in customer count, partially offset by price increases.
  • Revenue Trend: The company reported a favorable "bending of the revenue curve" for the sixth consecutive quarter, with the rate of revenue decline improving compared to the previous quarter.
  • Customer Metrics: Deceleration in customer count decline rate, supported by new acquisitions, stable renewal rates, and strong average spend per customer.
• Pension and Strategic Actions:
  • Annuity Purchase: Completed the purchase of group annuity contracts for $210 million from BMO Life Assurance Company on May 21, 2025, annuitizing approximately 50% of the pension liability.
  • Pension Contribution: Board approved an accelerated voluntary contribution of $2.0 million (part of a previously announced $4.0 million plan) to be completed by the end of 2025.
  • Settlement Loss: The net income decrease was impacted by a settlement loss on the annuity purchase and a $0.6 million revaluation expense on cash-settled stock-based compensation (vs. a $1.2 million recovery in Q2 2024).
• Dividend Declaration:
  • Board declared a cash dividend of $0.25 per common share.
  • Payment date: September 15, 2025.
  • Record date: August 25, 2025.
  • Designated as an eligible dividend.

Notable Quotes

• Sherilyn King, President and CEO: "We are pleased with our second quarter results, which reflect our continuing progress toward revenue stability, and a strong cash balance."
• Sherilyn King, President and CEO: "For the sixth consecutive quarter, we report a favorable 'bending of the revenue curve' in Q2, as our rate of change in revenue was better than the change reported for the previous quarter."
• Sherilyn King, President and CEO: "We are encouraged by the continued momentum in the core metrics driving our revenue performance. These include the continued deceleration of the customer count decline rate, supported by new customer acquisitions, stable renewal rates and strong average spend per customer."