DCM Data Communications Management Corp

DATA Communications Management Corp. (TSX: DCM; OTCQX: DCMDF) (“DCM” or the "Company"), a leading provider of marketing and business communication solutions to companies across North America, is pleased to report continued momentum in the second quarter of 2023 with revenue up +74.7%, and gross profit up +56.7%, compared to the second quarter of 2022, respectively. Year over year growth is primarily driven by the acquisition of Moore Canada Corporation ("MCC"). The combined business achieved growth from expansion revenue with existing clients, new client wins, and continuing progress passing raw material increases on to our customers.

SECOND QUARTER 2023 HIGHLIGHTS - BUILDING A BIGGER BUSINESS

• Revenue for the second quarter of 2023 was up +74.7%, or +$50.9 million, vs. Q2 year ago (YA), for total revenues of $119.0 million. This revenue growth is primarily driven by additional revenues from the acquisition of MCC;
• Gross profit accelerated +56.7%, or +$11.6 million for a total of $32.0 million; Gross profit margin was 26.9% for the second quarter of 2023 vs. 30.0% YA. As expected, the lower average gross margins of MCC contributed to a lower overall gross margin. Planned initiatives to drive synergies and optimize our operational footprint are already in action, and are expected to improve consolidated gross margins;
• Adjusted EBITDA1 increased +48.6% compared to last year, and was $13.8 million or 11.6% of revenue vs. $9.3 million or 13.7% of revenues YA. Adjusted EBITDA as a percentage of revenues declined due to the lower average gross margins of MCC;
• One-time adjustments recorded of $3.8 million in costs related to the acquisition and integration of MCC and restructuring costs of $2.7 million for the quarter;
• Total net debt at the end of the second quarter of 2023 was $93.6 million (total debt less cash on hand), down more than 30% since closing the MCC acquisition. During the second quarter of 2023, DCM financed 100% of the MCC with debt, and subsequently made repayments totaling $60.4 million, of which $24.5 million related to the Bank Credit Facility, $23.1 million to the Real Estate Bridge Loan, $6.1 million to repaying in full the FPD IV and FPD V term loans, and the remaining balance was applied towards regular principal repayments on term loans.

____________________________ 1 Note: EBITDA, Adjusted EBITDA, Adjusted EBITDA as a percentage of revenues, Adjusted net income (loss) and Adjusted net income (loss) as a percentage of revenues are not earnings measures recognized by International Financial Reporting Standards (IFRS), do not have any standardized meanings prescribed by IFRS and might not be comparable to similar financial measures disclosed by other issuers. EBITDA, Adjusted EBITDA, Adjusted EBITDA as a percentage of revenues, Adjusted net income (loss) and Adjusted net income (loss) as a percentage of revenues should not be construed as alternatives to net income (loss) determined in accordance with IFRS as an indicator of DCM’s performance. For a description of the composition of EBITDA, Adjusted EBITDA, Adjusted EBITDA as a percentage of revenues, Adjusted net income (loss) and Adjusted net income (loss) as a percentage of revenues, why we believe such measures are useful to investors and how we use those measures in our business, together with a quantitative reconciliation of net income (loss) to EBITDA, Adjusted EBITDA and Adjusted net income (loss), respectively, see the information under the heading “Non-IFRS Measures” and the information set forth on Table 2 and Table 3.

SECOND QUARTER 2023 OPERATIONAL HIGHLIGHTS – BUILDING A BETTER BUSINESS

• On April 24, 2023, DCM closed the acquisition of MCC for a total cash purchase price of $130.8 million. During the quarter, the total post-closing working capital adjustments to the purchase price were $4.9 million for a total cash purchase price of $135.8 million. MCC is now a wholly-owned subsidiary of DCM. The acquisition was funded through a revolving, floating rate credit facility from a Canadian chartered bank, which includes up to $90 million of revolving credit capacity; a $30 million floating rate term loan facility from the bank; and a new $50 million fixed rate credit facility from Fiera Private Debt.
• DCM commenced planned initiatives to drive organizational synergies. Restructuring expenses of $2.7 million were recorded in connection with a reduction in the size of our combined team by approximately 30 associates. On an annualized basis, we expect savings of approximately $4.2 million from this initiative.
• On May 25, 2023, DCM completed a private placement ("Offering") of common shares of the Company (“Common Shares”), and issued 8,707,200 Common Shares at a price per share of $3.00 for gross proceeds of $26.1 million (or $24.2 million after closing costs). In connection with the Offering, the Company issued to the Agents broker warrants enabling them to acquire up to 261,216 Common Shares at a price of $3.1627 per share.
• On June 8, 2023, DCM entered into a sale and leaseback of its Oshawa, Ontario warehouse facility, acquired as part of the Company's acquisition of MCC. The sale generated $24.1 million in gross proceeds ($23.1 million in net proceeds). As DCM intends to use the Oshawa facility, the Company entered into a ten-year lease agreement with options to extend the lease term for a total additional term of up to ten years. The lease term also includes a capital improvement allowance of $1.5 million.

MANAGEMENT COMMENTARY

“We’d like to remind shareholders that we closed the MCC acquisition on April 24, 2023, and the results we are reporting include the combined results of our DCM business and MCC’s operations for one week in April, plus the months of May and June, so not quite a full quarter,” said Richard Kellam, CEO and President of DCM.

“Gross profit as a percentage of revenue for the second quarter of 2023 exceeded our expectations. The opportunity to enhance MCC profit margins was one of the key aspects of our acquisition deal logic and we have a clear plan in place to return our combined gross profit margins to pre-acquisition levels.”

“Another key element in our deal logic was MCC’s relatively lower SG&A expenses as a percentage of revenues, and we expect this will contribute to our objectives of zero and even negative overhead growth going forward.”

“We are making great progress on our integration strategy led by our combined Commercial team, whose collaborative efforts are delivering strong results including contract renewals, new business wins, and a growing pipeline. We are very optimistic we will deliver on our revenue plan and of exceeding our targeted 5% annual revenue growth rate.”

“We remain on track to achieve our targeted total annualized post-merger synergies in the range of $25 - $30 million over the next 18 - 24 months and have already announced $4.2 million of this target has been achieved to date. We are moving forward with plans to optimize our operational footprint and announced our decision during the quarter to close our plants in Edmonton, Alberta and Fergus, Ontario and to transfer production to other facilities in our network.”

“In the procurement area, our team is well on track to deliver anticipated savings by harmonizing our purchasing activities and leveraging our expanded scale to secure more favorable pricing for raw materials. We’ll report back on anticipated savings from these initiatives in the coming quarters.”

SECOND QUARTER 2023 EARNINGS CALL

The Company will host a conference call and webcast on Friday, August 11, 2023, at 9.00 a.m. Eastern time. Mr. Kellam, and James Lorimer, CFO, will present the second quarter 2023 results followed by a live Q&A period.

Instructions on how to access both the webcast and telephone call are available below. For those unable to join live, a replay of the webcast will be available on the DCM Investor Relations page.

DCM will be using Microsoft Teams to broadcast our earnings call, which will be accessible via the options below:

Click here to join the meeting

Meeting ID: 294 185 849 646 Passcode: fLoJbK

Or call in (audio only) +1 647-749-9154,,643054499# Canada, Toronto Phone Conference ID: 643 054 499#

The Company’s full results will be posted on its Investor Relations page and on www.sedar.com. A video message from Mr. Kellam will also be posted on the Company’s website.

TABLE 1 The following table sets out selected historical consolidated financial information for the periods noted.

For the periods ended June 30, 2023 and 2022

April 1 to June 30, 2023

April 1 to June 30, 2022

January 1 to June 30, 2023

January 1 to June 30, 2022

(in thousands of Canadian dollars, except share and per share amounts, unaudited)

 

 

 

 

 

Revenues

$

118,963

 

$

68,103

 

$

195,040

 

$

137,360

 

 

 

 

 

 

Gross profit

 

32,037

 

 

20,442

 

 

55,810

 

 

40,766

 

 

 

 

 

 

Gross profit, as a percentage of revenues

 

26.9

%

 

30.0

%

 

28.6

%

 

29.7

%

 

 

 

 

 

Selling, general and administrative expenses

 

23,004

 

 

13,957

 

 

36,879

 

 

27,147

 

As a percentage of revenues

 

19.3

%

 

20.5

%

 

18.9

%

 

19.8

%

 

 

 

 

 

Adjusted EBITDA

 

13,823

 

 

9,302

 

 

26,588

 

 

19,204

 

As a percentage of revenues

 

11.6

%

 

13.7

%

 

13.6

%

 

14.0

%

 

 

 

 

 

Net (loss) income for the period

 

(2,879

)

 

3,757

 

 

(5,311

)

 

7,470

 

 

 

 

 

 

Adjusted net income

 

3,778

 

 

3,625

 

 

9,667

 

 

7,678

 

As a percentage of revenues

 

3.2

%

 

5.3

%

 

5.0

%

 

5.6

%

 

 

 

 

 

Basic (loss) earnings per share

$

(0.06

)

$

0.09

 

$

(0.11

)

$

0.17

 

Diluted (loss) earnings per share

$

(0.06

)

$

0.08

 

$

(0.11

)

$

0.16

 

Adjusted net income per share, basic

$

0.08

 

$

0.08

 

$

0.21

 

$

0.17

 

Adjusted net income per share, diluted

$

0.08

 

$

0.08

 

$

0.21

 

$

0.17

 

Weighted average number of common shares outstanding, basic

 

49,055,088

 

 

44,062,831

 

 

46,572,750

 

 

44,062,831

 

Weighted average number of common shares outstanding, diluted

 

49,055,088

 

 

46,501,606

 

 

46,572,750

 

 

46,529,426

 

TABLE 2 The following table provides reconciliations of net (loss) income to EBITDA and of net (loss) income to Adjusted EBITDA for the periods noted.

EBITDA and Adjusted EBITDA reconciliation

For the periods ended June 30, 2023 and 2022

April 1 to June 30, 2023

April 1 to June 30, 2022

January 1 to June 30, 2023

January 1 to June 30, 2022

(in thousands of Canadian dollars, unaudited)

 

 

 

 

 

Net (loss) income for the period

$

(2,879

)

$

3,757

 

$

(5,311

)

$

7,470

 

 

 

 

 

Interest expense, net

 

3,499

 

 

1,343

 

 

4,582

 

 

2,598

Amortization of transaction costs and debt extinguishment gain, net

 

107

 

 

86

 

 

179

 

 

173

Current income tax expense

 

690

 

 

1,522

 

 

2,337

 

 

2,660

Deferred income tax (recovery) expense

 

(1,293

)

 

(47

)

 

(2,901

)

 

440

Depreciation of property, plant and equipment

 

1,365

 

 

781

 

 

2,056

 

 

1,561

Amortization of intangible assets

 

701

 

 

403

 

 

1,164

 

 

811

Depreciation of the ROU Asset

 

2,724

 

 

1,633

 

 

4,437

 

 

3,213

EBITDA

$

4,914

 

$

9,478

 

$

6,543

 

$

18,926

Acquisition and integration costs

 

3,837

 

 

—

 

 

9,955

 

 

—

Restructuring expenses

 

2,729

 

 

—

 

 

2,729

 

 

—

Net fair value (gains) losses on financial liabilities at fair value through profit or loss

 

2,343

 

 

(176

)

 

7,361

 

 

278

Adjusted EBITDA

$

13,823

 

$

9,302

 

$

26,588

 

$

19,204

TABLE 3 The following table provides reconciliations of net (loss) income 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 June 30, 2023 and 2022

April 1 to June 30, 2023

April 1 to June 30, 2022

January 1 to June 30, 2023

January 1 to June 30, 2022

(in thousands of Canadian dollars, except share and per share amounts, unaudited)

 

 

 

 

 

Net (loss) income for the period

$

(2,879

)

$

3,757

 

$

(5,311

)

$

7,470

 

 

 

 

 

 

Acquisition and integration costs

 

3,837

 

 

—

 

 

9,955

 

 

—

 

Restructuring expenses

 

2,729

 

 

—

 

 

2,729

 

 

—

 

Net fair value (gains) losses on financial liabilities at fair value through profit or loss

 

2,343

 

 

(176

)

 

7,361

 

 

278

 

Tax effect of the above adjustments

 

(2,252

)

 

44

 

 

(5,067

)

 

(70

)

Adjusted net income

$

3,778

 

$

3,625

 

$

9,667

 

$

7,678

 

 

 

 

 

 

Adjusted net income per share, basic

$

0.08

 

$

0.08

 

$

0.21

 

$

0.17

 

Adjusted net income per share, diluted

$

0.08

 

$

0.08

 

$

0.21

 

$

0.17

 

Weighted average number of common shares outstanding, basic

 

49,055,088

 

 

44,062,831

 

 

46,572,750

 

 

44,062,831

 

Weighted average number of common shares outstanding, diluted

 

49,055,088

 

 

46,501,606

 

 

46,572,750

 

 

46,529,426

 

About DATA Communications Management Corp.

DCM is a marketing and business communications partner that helps companies simplify the complex ways they communicate and operate, so they can accomplish more with fewer steps and less effort. For over 60 years, DCM has been serving major brands in vertical markets including financial services, retail, healthcare, energy, other regulated industries, and the public sector. We integrate seamlessly into our clients’ businesses thanks to our deep understanding of their needs, transformative tech-enabled solutions, and end-to-end service offering. Whether we’re running technology platforms, sending marketing messages, or managing print workflows, our goal is to make everything surprisingly simple.

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 the System for Electronic Document Analysis and Retrieval (SEDAR) at www.sedar.com.

FORWARD-LOOKING STATEMENTS

Certain statements in this press release constitute “forward-looking” statements that involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance, objectives or achievements of DCM, or industry results, to be materially different from any future results, performance, objectives or achievements expressed or implied by such forward-looking statements. When used in this press release, words such as “may”, “would”, “could”, “will”, “expect”, “anticipate”, “estimate”, “believe”, “intend”, “plan”, and other similar expressions are intended to identify forward-looking statements. 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 and 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. 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, include: our operating results are sensitive to economic conditions, which can have a significant impact on us, and uncertain economic conditions may have a material adverse effect on our business, results of operations and financial condition; our ability to successfully integrate the DCM and Moore Canada Corporation (“MCC”) businesses and realize anticipated benefits from the combination of those businesses, including revenue and profitability growth from an enhanced offering of products and services, larger customer base and cost reductions from synergies; there is limited growth in the traditional printing business, which may impact our ability to grow our sales or even maintain historical levels of sales of printed business and marketing communications materials; competition from competitors supplying similar products and services, some of whom have greater economic resources than us and are well established suppliers; increases in the cost of, and supply constraints related to, paper, ink and other raw material inputs used by DCM, as well as increases in freight costs, may adversely impact the availability of raw materials and our production, revenues and profitability; our ability to meet our revenue, profitability and debt reduction targets; our ability to comply with our financial covenants under our credit facilities or to obtain financial covenant waivers from our lenders if necessary; our ability to complete the proposed sales and leasebacks of certain properties and substantially reduce our bank term loan and total indebtedness; we may not be successful in obtaining capital to fund our business plans on satisfactory terms (or at all), including, without, limitation, with respect to investments in digital innovation (such as the development and successful marketing and sale of new digital capabilities), and capital expenditures; all of our outstanding indebtedness under our bank credit facility is subject to floating interest rates, and therefore is subject to fluctuations in interest rates, an increase of which would increase our borrowing costs. Additional factors are discussed elsewhere in this press release and under the headings "Liquidity and capital resources" and “Risks and Uncertainties” in DCM’s management’s discussion and analysis and in DCM’s other publicly available disclosure documents, as filed by DCM on SEDAR (www.sedar.com). 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 MEASURES

This press release includes certain non-IFRS measures as supplementary information. Except as otherwise noted, when used in this press release, EBITDA means earnings before interest and finance costs, taxes, depreciation and amortization and Adjusted EBITDA means EBITDA adjusted for restructuring expenses, integration costs, acquisition costs and the net fair value (gains) losses on financial liabilities at fair value through profit or loss for restricted share units ("RSUs") and deferred shared units ("DSUs"). Adjusted net income (loss) means net income (loss) adjusted for restructuring expenses, acquisition costs, integration costs, net fair value (gains) losses on financial liabilities at fair value through profit or loss for RSUs and DSUs and the tax effects of those items. Adjusted net income (loss) per share (basic and diluted) is calculated by dividing Adjusted net income (loss) for the period by the weighted average number of common shares of DCM (basic and diluted) outstanding during the period. Adjusted EBITDA as a percentage of revenues means Adjusted EBITDA divided by revenues and Adjusted net income (loss) as a percentage of revenues means Adjusted net income (loss) divided by revenues, in each case for the same period. In addition to net income (loss), DCM uses non-IFRS measures and ratios, including Adjusted net income (loss), Adjusted net income (loss) per share, Adjusted net income (loss) as a percentage of revenues, EBITDA, Adjusted EBITDA and Adjusted EBITDA as a percentage of revenues to provide investors with supplemental measures of DCM’s operating performance and thus highlight trends in its core business that may not otherwise be apparent when relying solely on IFRS financial measures. DCM also believes that securities analysts, investors, rating agencies and other interested parties frequently use non-IFRS measures in the evaluation of issuers. DCM’s management also uses non-IFRS measures in order to facilitate operating performance comparisons from period to period, prepare annual operating budgets and assess its ability to meet future debt service, capital expenditure and working capital requirements. Adjusted net income (loss), Adjusted net income (loss) per share, EBITDA and Adjusted EBITDA are not earnings measures recognized by IFRS and do not have any standardized meanings prescribed by IFRS. Therefore, Adjusted net income (loss), Adjusted net income (loss) per share, Adjusted net income (loss) as a percentage of revenues, EBITDA, Adjusted EBITDA and Adjusted EBITDA as a percentage of revenues are unlikely to be comparable to similar measures presented by other issuers.

Investors are cautioned that Adjusted net income (loss), Adjusted net income (loss) per share, EBITDA and Adjusted EBITDA should not be construed as alternatives to net income (loss) determined in accordance with IFRS as an indicator of DCM’s performance. For a reconciliation of net income (loss) to EBITDA, a reconciliation of net income (loss) to Adjusted EBITDA, reconciliation of net income (loss) to Adjusted net income (loss) and a presentation of Adjusted net income (loss) per share, see Table 2 and Table 3 above.

Condensed interim consolidated statements of financial position

 

 

(in thousands of Canadian dollars, unaudited)

June 30, 2023

December 31, 2022

 

$

$

 

 

 

Assets

 

 

Current assets

 

 

Cash and cash equivalents

$

20,973

$

4,208

Trade receivables

 

105,085

 

54,630

Inventories

 

38,486

 

20,220

Prepaid expenses and other current assets

 

5,632

 

2,984

Income taxes receivable

 

—

 

15

 

 

170,176

 

82,057

Non-current assets

 

 

Other non-current assets

 

1,158

 

466

Deferred income tax assets

 

10,278

 

4,830

Property, plant and equipment

 

29,727

 

6,779

Right-of-use assets

 

91,507

 

33,505

Pension assets

 

2,784

 

2,364

Intangible assets

 

14,057

 

2,507

Goodwill

 

43,851

 

16,973

 

$

363,538

$

149,481

 

 

 

Liabilities

 

 

Current liabilities

 

 

Trade payables and accrued liabilities

$

75,100

$

44,133

Current portion of credit facilities

 

9,701

 

11,667

Current portion of lease liabilities

 

12,019

 

6,791

Provisions

 

2,940

 

1,316

Income taxes payable

 

331

 

1,630

Deferred revenue

 

5,745

 

3,942

 

 

105,836

 

69,479

Non-current liabilities

 

 

Credit facilities

 

102,996

 

15,380

Lease liabilities

 

84,850

 

33,011

Pension obligations

 

18,649

 

6,069

Other post-employment benefit plans

 

3,661

 

2,695

Asset retirement obligation

 

2,741

 

—

 

$

318,733

$

126,634

 

 

 

Equity

 

 

Shareholders’ equity

 

 

Shares

$

283,738

$

256,478

Warrants

 

219

 

869

Contributed surplus

 

2,729

 

3,131

Translation Reserve

 

206

 

207

Deficit

 

(242,087)

 

(237,838)

 

$

44,805

$

22,847

 

$

363,538

$

149,481

Condensed interim consolidated statements of operations

 

 

 

 

(in thousands of Canadian dollars, except per share amounts, unaudited)

For the three months ended June 30, 2023

 

For the three months ended June 30, 2022

 

For the six months ended June 30, 2023

 

For the six months ended June 30, 2023

 

$

 

$

 

$

 

$

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenues

$

118,963

 

$

68,103

 

195,040

 

137,360

 

 

 

 

 

 

 

 

Cost of revenues

 

86,926

 

 

47,661

 

139,230

 

96,594

 

 

 

 

 

 

 

 

Gross profit

 

32,037

 

 

20,442

 

55,810

 

40,766

 

 

 

 

 

 

 

 

Expenses

 

 

 

 

 

 

 

Selling, commissions and expenses

 

9,850

 

 

7,244

 

18,171

 

14,261

General and administration expenses

 

13,154

 

 

6,713

 

18,708

 

12,886

Restructuring expenses

 

2,729

 

 

—

 

2,729

 

—

Acquisition and integration costs

 

3,837

 

 

—

 

9,955

 

—

Net fair value (gains) losses on financial liabilities at fair value through profit or loss

 

2,343

 

 

(176)

 

7,361

 

278

 

 

31,913

 

 

13,781

 

56,924

 

27,425

 

 

 

 

 

 

 

 

Income before finance and other costs, and income taxes

 

124

 

 

6,661

 

(1,114)

 

13,341

 

 

 

 

 

 

 

 

Finance costs

 

 

 

 

 

 

 

Interest expense on long term debt and pensions, net

 

2,480

 

 

779

 

3,023

 

1,470

Interest expense on lease liabilities

 

1,019

 

 

564

 

1,559

 

1,128

Amortization of transaction costs net of debt extinguishment gain

 

107

 

 

86

 

179

 

173

 

 

3,606

 

 

1,429

 

4,761

 

2,771

 

 

 

 

 

 

 

 

(Loss) income before income taxes

 

(3,482)

 

 

5,232

 

(5,875)

 

10,570

 

 

 

 

 

 

 

 

Income tax expense

 

 

 

 

 

 

 

Current

 

690

 

 

1,522

 

2,337

 

2,660

Deferred

 

(1,293)

 

 

(47)

 

(2,901)

 

440

 

 

(603)

 

 

1,475

 

(564)

 

3,100

 

 

 

 

 

 

 

 

Net (loss) Income for the period

$

(2,879)

 

$

3,757

 

(5,311)

 

7,470

Condensed interim consolidated statements of cash flows

 

(in thousands of Canadian dollars, unaudited)

For the six months ended June 30, 2023

 

For the six months ended June 30, 2022

 

$

 

$

 

 

 

 

Cash provided by (used in)

 

 

 

 

 

 

 

Operating activities

 

 

 

Net (loss) income for the period

$

(5,311)

 

$

7,470

Items not affecting cash

 

 

 

Depreciation of property, plant and equipment

 

2,056

 

 

1,561

Amortization of intangible assets

 

1,164

 

 

811

Depreciation of right-of-use-assets

 

4,437

 

 

3,213

Interest expense on lease liabilities

 

1,559

 

 

1,128

Share-based compensation expense

 

269

 

 

148

Pension expense

 

430

 

 

218

Loss on disposal of property, plant and equipment

 

—

 

 

9

Provisions

 

2,729

 

 

—

Amortization of transaction costs, accretion of debt premium/discount, net of debt extinguishment gain

 

179

 

 

293

Accretion of non-current liabilities

 

6

 

 

—

Other post-employment benefit plans expense

 

208

 

 

136

Income tax (recovery) expense

 

(564)

 

 

3,100

Changes in working capital

 

13,163

 

 

(12,415)

Contributions made to pension plans

 

(528)

 

 

(482)

Contributions made to other post-employment benefit plans

 

(90)

 

 

(88)

Provisions paid

 

(1,785)

 

 

(2,633)

Income taxes paid

 

(3,305)

 

 

(368)

 

 

14,617

 

 

2,101

 

 

 

 

Investing activities

 

 

 

Net cash consideration for acquisition of MCC

 

(126,031)

 

 

—

Proceeds on sale and leaseback transaction

 

24,091

 

 

—

Purchase of property, plant and equipment

 

(1,298)

 

 

(419)

Purchase of intangible assets

 

(14)

 

 

—

Proceeds on disposal of property, plant and equipment

 

58

 

 

56

 

 

(103,194)

 

 

(363)

 

 

 

 

Financing activities

 

 

 

Issuance of common shares and broker warrants, net

 

24,221

 

 

—

Exercise of warrants

 

489

 

 

—

Exercise of options

 

751

 

 

—

Proceeds from credit facilities

 

147,640

 

 

7,800

Repayment of credit facilities

 

(60,367)

 

 

(5,918)

Decrease in restricted cash

 

—

 

 

515

Transaction costs

 

(1,802)

 

 

—

Lease payments

 

(5,568)

 

 

(4,265)

 

 

105,364

 

 

(1,868)

 

 

 

 

Change in cash and cash equivalents during the period

 

16,787

 

 

(130)

Cash and cash equivalents – beginning of period

$

4,208

 

$

901

Effects of foreign exchange on cash balances

 

(22)

 

 

4

Cash and cash equivalents – end of period

$

20,973

 

$

775

 

View source version on businesswire.com: https://www.businesswire.com/news/home/20230810261356/en/

For further information, contact Mr. Richard Kellam President and Chief Executive Officer DATA Communications Management Corp. Tel: (905) 791-3151

Mr. James E. Lorimer Chief Financial Officer DATA Communications Management Corp. Tel: (905) 791-3151 ir@datacm.com