Dye & Durham Reports Second Quarter Fiscal 2026 Financial Results

Dye & Durham Reports Second Quarter Fiscal 2026 Financial Results Canada NewsWire TORONTO, Feb. 16, 2026 Revenue for the three and six months ended December 31, 2025 of $107.0 million and $215.3 million, respectively. Net loss for the three and six months ended December 31, 2025 of $(21.8) million and $(60.1) million, respectively. Adjusted EBITDA¹ for the three and six ended December 31, 2025 of $50.4 million and $100.8 million, respectively. TORONTO, Feb. 16, 2026 /CNW/ - Dye & Durham Limited (the "Company" or "Dye & Durham") (TSX: DND), a leading provider of cloud-based legal practice management software, today announced its financial results for the three and six months ended December 31, 2025. "Our second quarter reflects a business moving from stabilization to consistent execution," says George Tsivin, Chief Executive Officer, Dye & Durham. "We continue to generate strong operating cash flow and have taken decisive action to simplify the business, reduce leverage, and reinvest where it matters most to our customers. While parts of our Legal Software Business face near-term market headwinds, we are making tangible progress on our multi-year transformation to reduce complexity and deliver a more connected product experience. With a strengthened team and a clear path forward, we are well positioned for long-term growth." Second Quarter Fiscal 2026 Highlights ($ presented in thousands) Consolidated highlights Selected key metrics: Three months ended December 31, Six months ended December 31, 2024 2024 2025 (Restated) 2025 (Restated) $ $ $ $   Revenue 107,024 115,746 215,326 232,137   Net loss (21,790) (19,664) (60,062) (34,959)   Cash flow from operating activities   33,577 15,626 73,794 62,266   Adjusted EBITDA(1) 50,352 64,652 100,787 132,203 Certain comparative figures for the three and six months ended December 31, 2024 have been restated. See "Restatement of Prior Period Comparative Information" in Note 2 of the Condensed Consolidated Interim Financial Statements for the three and six months ended December 31, 2025. (1) Represents a non-IFRS measure. See "Non-IFRS Measures." Revenue for the three months ended December 31, 2025, was $107.0 million, a decrease of $8.7 million, or 8%, compared to the three months ended December 31, 2024. Revenue for the six months ended December 31, 2025 and December 31, 2024 was $215.3 million and $232.1 million, respectively, a decrease of $16.8 million, or 7%. The decrease was primarily driven by a combination of market downturn and the impact of lower volumes and pricing from both the loss of customers and contract renewal terms affecting practice management and data insights platforms, partially offset by growth in Banking Technology and Affinity. Net loss for the three months ended December 31, 2025 was $21.8 million, compared to a net loss of $19.7 million for the equivalent period in the prior year. Net loss for the six months ended December 31, 2025 was $60.1 million, compared to a net loss of $35.0 million for the equivalent period in the prior year. The greater loss was primarily driven by lower revenue, higher operating expenses, and the stock based compensation reversal in the prior periods partially offset by lower interest costs, lower amortization and lower acquisition, restructuring and other costs. Net cash provided by operating activities for the three months ended December 31, 2025 was $33.6 million, compared to $15.6 million for the equivalent period in the prior year. The year over year improvement in cash flow from operations was driven by lower financing costs, lower taxes paid, and improvements in working capital. Adjusted EBITDA(1) for the three months ended December 31, 2025 was $50.4 million, a decrease of $14.3 million, or 22%, compared to the three months ended December 31, 2024. For the six months ended December 31, 2025 and 2024, Adjusted EBITDA(1) was $100.8 million and $132.2 million, respectively, a decrease of $31.4 million, or 24%. The decrease in Adjusted EBITDA(1) was driven by revenue impacts described above, strategic reinvestments necessary to stabilize the business, predominantly labour and IT infrastructure, and a lower capitalization rate as the Company temporarily shifted certain expenditures from capitalized projects to maintenance expense. The Company was in compliance with the financial maintenance covenant under its senior credit agreement with respect to the three months ended December 31, 2025. At December 31, 2025, the Company had drawn $61.5 million on the revolving credit facility and the Consolidated First Lien Net Leverage Ratio (as such term is defined in the senior credit agreement) was approximately 4.98x. Quarterly Dividend As previously disclosed in the Company's press release dated February 2, 2026, the board of directors of the Company (the "Board") is continuing to assess the Company's approach with respect to the declaration and payment of dividends on the Company's issued and outstanding common shares and has deferred a decision regarding the declaration and payment of dividends until the Board completes a review of the Company's strategic plan, which is expected to occur during the fiscal quarter ending March 31, 2026. Accordingly, at this time the Board has not declared a dividend with respect to the three-month period ended December 31, 2025. The Board intends to provide an update as to its intended go-forward dividend policy in conjunction with the Company's release of its strategic plan. Conference Call Notification As previously disclosed, the Company will host a conference call on Tuesday, February 17, 2026 at 8:00 a.m. Eastern Time during which senior management will discuss the Company's financial performance for the three and six months ended December 31, 2025. A question-and-answer session for research analysts will follow the corporate update. Conference Call Details Date:  Tuesday, February 17, 2026 Time:     8:00 a.m. ET Conference Call:     Toll Free Dial-In Number: 1-888-699-1199 Dial-In Number (GTA): 416-945-7677 Webcast URL:   https://app.webinar.net/GBd0OGdnx8W Please dial in at least five minutes before the call begins. Replay:     Available through February 24, 2026 Replay Access:      Toll-Free Dial-In Number: 1-888-660-6345 Dial-In Number (GTA): 646-517-4150 Passcode: 41315 # Update on Annual General and Special Meeting of Shareholders On February 11, 2026, Wahi Investments Inc. ("Wahi Investments") delivered a nomination notice (the "Nomination Notice") revising and supplementing prior notices submitted by Wahi Investments purporting to nominate Ronnie Wahi for election to the Board at the upcoming Annual General and Special Meeting of Shareholders to be held on March 4, 2026, as previously disclosed by the Company. The Board reviewed the Nomination Notice in good faith in consultation with its legal counsel and determined to accept the Nomination Notice (without prejudice to the Company's and the Board's rights, and without any admission as to the completeness, accuracy or validity of the Nomination Notice or any proxy solicitation materials delivered in connection with the nomination of Mr. Wahi) notwithstanding that the Nomination Notice was not fully compliant with the applicable requirements set out in the Company's By-Law No. 1 ("By-Laws"). In accordance with Section 6.4 of the By-Laws, the information provided in the Nomination Notice is being made publicly available to shareholders on the Company's website at https://dyedurham.com/investors/governance/. Additional Information The quarterly unaudited consolidated financial statements for the three and six months ended December 31, 2025, related Management's Discussion and Analysis and CEO and CFO certificates are available on SEDAR+ at www.sedarplus.ca. Non-IFRS Measures 1 Adjusted EBITDA is a non-IFRS financial measure. This measure is not a recognized measure under IFRS, does not have a standardized meaning prescribed by IFRS and is therefore unlikely to be comparable to similar measures presented by other companies. The Company uses non-IFRS financial measures, namely, "Adjusted EBITDA", to provide investors with supplemental measures of its operating performance and to eliminate items that have less bearing on operating performance or operating conditions and thus highlight trends in its core business that may not otherwise be apparent when relying solely on IFRS financial measures. Specifically, the Company believes that the aforementioned non-IFRS financial measure, when viewed with the Company's results under IFRS and the accompanying reconciliations, provide useful information about the Company's business without regard to potential distortions. By eliminating potential differences in results of operations between periods caused by factors such as depreciation and amortization methods and acquisition, restructuring, impairment and other charges such as acquisition, listing and reorganization related expenses, integration expenses and corporate cost allocations, the Company believes that the non-IFRS financial measures included herein can provide a useful additional basis for comparing the current performance of the underlying operations being evaluated. Below is the Company's definition of the non-IFRS measure used herein: "Adjusted EBITDA" adjusts net loss by adding back financing costs, amortization, depreciation and impairment costs, income tax expense (recovery), stock-based compensation expense (recovery), loss (gain) on contingent receivables and assets held for sale, specific transaction-related expenses related to acquisition and reorganization related expenses, integration and operational restructuring costs and other non-recurring expenses. Operational restructuring costs are incurred as a direct or indirect result of acquisition activities. See reconciliations in the tables attached to this press release. ABOUT DYE & DURHAM LIMITED Dye & Durham Limited provides premier practice management solutions empowering legal professionals every day, delivers vital data insights to support critical corporate transactions and enables the essential payments infrastructure trusted by government and financial institutions. The company has operations in Canada, the United Kingdom, Ireland, Australia, and South Africa. Additional information can be found at www.dyedurham.com. Forward-looking Statements This press release may contain forward-looking information and forward-looking statements within the meaning of applicable securities laws, which reflects the Company's current expectations regarding future events, including statements with respect to the declaration and payment of dividends, the Company's intended go-forward dividend policy, and the Company's intention to release a full strategic plan. In some cases, but not necessarily in all cases, forward-looking statements can be identified by the use of forward looking terminology such as "plans", "targets", "expects" or "does not expect", "is expected", "an opportunity exists", "is positioned", "estimates", "intends", "assumes", "anticipates" or "does not anticipate" or "believes", or variations of such words and phrases or state that certain actions, events or results "may", "could", "would", "might", "will" or "will be taken", "occur" or "be achieved". In addition, any statements that refer to expectations, projections or other characterizations of future events or circumstances contain forward-looking statements. Forward-looking statements are not historical facts, nor guarantees or assurances of future performance but instead represent management's current beliefs, expectations, estimates and projections regarding future events and operating performance. The forward-looking information is based on management's opinions, estimates and assumptions, including, but not limited to: the Board and Company will be in a position to outline its go-forward dividend policy and strategic plan, and  those assumptions described under the heading "Caution Regarding Forward-Looking Information" in the Company's Management's Discussion and Analysis for the period ended December 31, 2025. While these opinions, estimates and assumptions are considered by Dye & Durham to be appropriate and reasonable in the circumstances as of the date of this press release, they are subject  to a number of risks and uncertainties, many of which are beyond Dye & Durham's control, which could cause actual results and events to differ materially from those that are disclosed in or implied by such forward-looking information. Such risks and uncertainties include, but are not limited to: the Company not resuming the payment of dividends, the Board being delayed in finalizing the Company's go-forward dividend policy, the Company being delayed in finalizing its strategic plan, and those risk factors discussed in greater detail under the "Risk Factors" section of the Company's most recent annual information form and under the heading "Risks and Uncertainties" in the Company's most recent Management's Discussion and Analysis, which are available under Dye & Durham's profile on SEDAR+ at www.sedarplus.ca. 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. There can be no assurance that such information will prove to be accurate, as actual results and future events could differ materially from those anticipated in such information. No forward-looking statement is a guarantee of future results. Accordingly, you should not place undue reliance on forward-looking information, which speaks only as of the date made. The forward-looking information contained in this press release represents Dye & Durham's expectations as of the date specified herein and are subject to change after such date. The Company disclaims any intention or obligation or undertaking to update or revise any forward-looking information or to publicly announce the results of any revisions to any of those statements for any reason, except as required under applicable securities laws. Comparisons of results for current and any prior periods are not intended to express any future trends or indications of future performance, unless specifically expressed as such, and should only be viewed as historical data. Consolidated Results of Operations Three months ended December 31, Six months ended December 31, 2024 2024 2025 (Restated) 2025 (Restated) $ $ $ $ Revenue 107,024 115,746 215,326 232,137 Expenses Direct costs (8,607) (9,827) (18,453) (18,813) Technology and operations (28,368) (26,460) (58,663) (51,356) General and administrative (14,445) (10,584) (26,538) (21,165) Sales and marketing (5,252) (4,223) (10,885) (8,600) Stock-based (compensation) recovery (expense) (932) 47,642 (3,698) 42,451 Finance costs, net (27,339) (55,839) (73,224) (90,422) Amortization, depreciation and impairment (30,629) (41,415) (64,256) (81,758) Acquisition, restructuring and other costs (15,930) (40,162) (22,660) (43,970) Loss before income taxes (24,478) (25,122) (63,051) (41,496) Income tax recovery 2,688 5,458 2,989 6,537 Net loss (21,790) (19,664) (60,062) (34,959) Net loss attributable to:   Non-controlling interests 4 705 (250) 479 Shareholders (21,794) (20,369) (59,812) (35,438) (21,790) (19,664) (60,062) (34,959) Net loss per common share Basic (0.32) (0.30) (0.89) (0.53) Diluted (0.32) (0.30) (0.89) (0.53) Weighted average number of shares outstanding   Basic Basic 67,171 66,975 67,171 66,945 Diluted 67,171 66,975 67,171 66,945 Certain comparative figures for the three and six months ended December 31, 2024 have been restated. See "Restatement of Prior Period Comparative Information" in Note 2 of the Condensed Consolidated Interim Financial Statements for the three and six months ended December 31, 2025.  Adjusted EBITDA Three months ended December 31, Six months ended December 31, 2024 2024 2025 (Restated) 2025 (Restated) $ $ $ $ Loss for the period (21,790) (19,664) (60,062) (34,959)   Amortization, depreciation and impairment(1) 30,629 41,415 64,256 81,758   Finance costs(2) 27,339 55,839 73,224 90,422   Income tax recovery (2,688) (5,458) (2,989) (6,537)   Stock-based compensation expense (recovery)(3)    932 (47,642) 3,698 (42,451)   Acquisition, restructuring, and other costs(4)  15,930 40,162 22,660 43,970 Adjusted EBITDA(5) 50,352 64,652 100,787 132,203 Certain comparative figures for the three and six months ended December 31, 2024 have been restated. See "Restatement of Prior Period Comparative Information" in Note 2 of the Condensed Consolidated Interim Financial Statements for the three and six months ended December 31, 2025. (1) Depreciation and amortization expense is primarily related to acquired and developed intangible assets, depreciation expense on property, equipment, and right-of-use assets. (2) Finance costs are primarily related to interest expenses incurred on borrowings, changes in fair value of convertible debt and derivatives, lease obligations, net of interest income. (3) Stock-based compensation represents expenditures recognized in connection with stock options issued to employees and directors and cash settled share appreciation rights issued to directors and other related costs. (4) Acquisition, restructuring, and other costs relates to professional fees and integration costs incurred in connection with acquisition, divestiture, listing, reorganization related expenses and changes in fair value of contingent consideration. Restructuring expenses mainly represent employee exit costs as a result of synergies created due to business combinations and organizational changes and are expected to be paid within the fiscal year. Other costs primarily relate to non-recurring costs, including severance, and legal, advisory and other professional fees associated with the change in the Board and the delayed filing of the financial statements. (5) Represents a non-IFRS measure. See "Non-IFRS Measures". Condensed Consolidated Interim Statements of Financial Positions (Unaudited) (Expressed in thousands of Canadian dollars) As at: December 31, June 30, 2025 2025 $ $ Assets Current assets: Cash and cash equivalents 37,849 43,098 Trade and other receivables 73,106 88,077 Prepaid expenses and other assets 14,870 11,865 Restricted investments 185,000 185,000 310,825 328,040 Assets held for sale 6,577 -- 317,402 328,040 Non-current assets: Prepayment option 178 20,947 Property and equipment, net 7,310 8,111 Right-of-use assets, net 12,772 13,872 Intangible assets, net 624,325 676,599 Goodwill 1,100,935 1,100,171 Other assets 2,697 3,776 Total assets 2,065,619 2,151,516 Liabilities and equity Current liabilities: Accounts payable and accrued liabilities 73,722 78,833 Customer advances 20,432 24,888 Holdbacks and contingent considerations, current 28,302 36,218 Lease liabilities, current 5,734 5,153 Loans and borrowings, current 18,233 18,285 Derivative liabilities, current 3,678 -- Convertible debentures 316,639 335,433 466,740 498,810 Liabilities directly associated with assets held for sale   2,254 -- 468,994 498,810 Non-current liabilities: Holdbacks and contingent considerations 10,069 20,637 Lease liabilities 10,618 12,452 Loans and borrowings 1,249,341 1,233,158 Derivative liabilities 10,129 29,268 Deferred tax liabilities 92,139 99,641 Other liabilities 2,423 2,226 Total liabilities 1,843,713 1,896,192 Equity Capital stock 824,165 824,113 Contributed surplus 53,863 50,116 Accumulated other comprehensive income (loss) 16,559 (6,286) Deficit (672,949) (613,137) Non-controlling interests 268 518 221,906 255,324 Total liabilities and equity 2,065,619 2,151,516   Q3 2025 Quarterly Results Q2 2026 Q1 2026 Q4 2025 (Restated) (In thousands of Canadian dollars, except per share data)   $ $ $ $   Revenue 107,024 108,302 105,173 103,420   Net loss(1) (21,790) (38,272) (29,552) (23,449)   Adjusted EBITDA(2) 50,352 50,435 47,744 52,862   Net loss per common share (0.32) (0.57) (0.44) (0.35)   Net loss per diluted share (0.32) (0.57) (0.44) (0.35) Q2 2025 Q1 2025 Q4 2024 Q3 2024 Quarterly Results (Restated) (Restated) (Restated) (Restated) (In thousands of Canadian dollars, except per share data) $ $ $ $   Revenue 115,746 116,391 117,520 103,452   Net loss(1) (19,664) (15,295) (97,425) (27,118)   Adjusted EBITDA(2) 64,652 67,551 65,976 56,454   Net loss per common share (0.30) (0.23) (1.63) (0.43)   Net loss per diluted share (0.30) (0.23) (1.63) (0.43) Certain comparative figures for 2024 and the first, second and third quarters of 2025 have been restated. See "Restatement of Prior Period Comparative Information" in Note 2 of the Condensed Consolidated Interim Financial Statements for the three and six months ended December 31, 2025. (1) Includes income tax expense (recovery). (2) Represents a non-IFRS measure. See "Non-IFRS Measures". SOURCE Dye & Durham Limited View original content to download multimedia: http://www.newswire.ca/en/releases/archive/February2026/16/c7825.html Contact: FOR FURTHER INFORMATION, PLEASE CONTACT: Investor Relations: [email protected]