MARKHAM,
ON, Dec. 12, 2024 /CNW/ - Enghouse Systems
Limited (TSX:ENGH) announces its fourth quarter
(unaudited) and audited year-end financial results for the period
ended October 31, 2024. All figures
are denominated in Canadian dollars unless otherwise indicated.
Fourth Quarter and Annual Financial Highlights:
- Revenue increased 2.1% to $125.7 million from $123.1 million in the fourth quarter last
year and 10.7% for the fiscal year to $502.5 million from $454.0 million last year;
- Recurring revenue, which includes SaaS and maintenance
services, grew 1.1% to $88.2 million
compared to $87.2 million in Q4 2023,
and represents 70.2% of total revenue. For the fiscal year,
recurring revenue increased to $346.6
million from $297.6 million in
the prior year, an increase of 16.4%, as we continue to see
increased demand for SaaS;
- Results from operating activities decreased to $33.4 million compared to $35.7 million in Q4 2023 and increased in
the fiscal year to $133.8 million, from $122.1 million in the prior year;
- Net income was $22.6 million
compared to $25.1 million in Q4 2023 and $81.3 million in the fiscal year compared to
$72.2 million last year as we
continue to grow our business with a focus on profitability;
- Adjusted EBITDA decreased to $35.6 million compared to $37.9 million, while achieving a 28.3% margin for
the quarter. Annual adjusted EBITDA was $143.8 million compared to $133.8 million in the prior year, an
increase of 7.5%;
- Cash flow from operating activities, excluding changes in
working capital, was $40.3 million compared to $43.5 million in the prior year's fourth
quarter and $151.8 million for
the fiscal year compared to $140.5 million in the prior year. Cash and
cash equivalents increased to record levels of $274.2 million as at October 31, 2024.
Fiscal 2024 yielded a third year of consecutive revenue growth
following the COVID period, which saw an unprecedented spike in
demand for our Vidyo applications. We achieved a significant
milestone, with revenue for the fiscal year exceeding $500 million, representing double digit growth of
10.7%. During the year we deployed cash of $43.4 million on acquisitions and returned
$53.1 million to our shareholders
through dividends. At the same time, we increased our cash reserves
to $274.2 million, with no external
debt, which positions the Company well for further acquisition
growth. We are also pleased to announce record annual SaaS and
maintenance services revenue of $346.6
million, an increase of $49.0 million or 16.4% compared to the
prior year. SaaS and maintenance services continue to be an
important source of revenue characterized by their predictable and
recurring nature. They now represent 69.0% of total revenues for
the year compared to 65.6% in the prior year.
In addition to the SaaS and maintenance growth, our professional
services and hardware revenue showed marked increases for the year.
In the current business environment, demand for on-premise,
perpetual software licenses has declined as more customers are
choosing SaaS solutions that require less upfront capital
investment. During this market transition, we continue to focus on
maintaining profitability as demonstrated by the 12.6% increase in
our net income to $81.3 million from
$72.2 million in the prior year.
We closed the year with a double digit increase in revenue and
net income, significant expansion of our recurring revenue, record
cash reserves and no external debt, positioning us to pursue
opportunities that meet our acquisition criteria while continuing
to pay dividends to our shareholders. The growth in revenue was
achieved through our ability to acquire and effectively integrate
new acquisitions into our business model.
Quarterly
dividends:
Today, the Board of Directors approved the Company's eligible
quarterly dividend of $0.26 per
common share payable on February 28,
2025 to shareholders of record at the close of business on
February 14, 2025.
Enghouse Systems Limited
Financial Highlights
(unaudited, in thousands of Canadian
dollars)
|
For the period ended
October 31
|
Three months
(Unaudited)
|
|
Twelve
months
|
|
2024
|
|
2023
|
Var
($)
|
Var
(%)
|
|
|
2024
|
|
2023
|
Var
($)
|
Var
(%)
|
|
Revenue
|
$
|
125,702
|
$
|
123,129
|
2,573
|
2.1
|
|
$
|
502,505
|
$
|
454,022
|
48,483
|
10.7
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Direct costs
|
|
44,967
|
|
41,213
|
3,754
|
9.1
|
|
|
175,586
|
|
149,999
|
25,587
|
17.1
|
|
Revenue, net of
direct costs
|
$
|
80,735
|
$
|
81,916
|
(1,181)
|
(1.4)
|
|
$
|
326,919
|
$
|
304,023
|
22,896
|
7.5
|
|
As a % of
revenue
|
|
64.2 %
|
|
66.5 %
|
|
|
|
|
65.1 %
|
|
67.0 %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
expenses
|
|
47,133
|
|
46,115
|
1,018
|
2.2
|
|
|
191,464
|
|
179,438
|
12,026
|
6.7
|
|
Special
charges
|
|
169
|
|
117
|
52
|
44.4
|
|
|
1,609
|
|
2,477
|
(868)
|
(35.0)
|
|
Results from
operating activities
|
$
|
33,433
|
$
|
35,684
|
(2,251)
|
(6.3)
|
|
$
|
133,846
|
$
|
122,108
|
11,738
|
9.6
|
|
As a % of
revenue
|
|
26.6 %
|
|
29.0 %
|
|
|
|
|
26.6 %
|
|
26.9 %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Amortization of
acquired software and customer relationships
|
|
(9,322)
|
|
(11,205)
|
1,883
|
16.8
|
|
|
(40,505)
|
|
(39,605)
|
(900)
|
(2.3)
|
|
Foreign exchange gains
(losses)
|
|
1,870
|
|
2,753
|
(883)
|
32.1
|
|
|
(1,680)
|
|
1,266
|
(2,946)
|
(232.7)
|
|
Interest expense –
lease obligations
|
|
(126)
|
|
(164)
|
38
|
23.2
|
|
|
(556)
|
|
(695)
|
139
|
20.0
|
|
Finance
income
|
|
2,825
|
|
2,581
|
244
|
9.5
|
|
|
10,121
|
|
6,264
|
3,857
|
61.6
|
|
Finance
expenses
|
|
(8)
|
|
(27)
|
19
|
70.4
|
|
|
(49)
|
|
(163)
|
114
|
69.9
|
|
Other (expense)
income
|
|
(424)
|
|
17
|
(441)
|
(2594.1)
|
|
|
89
|
|
(1,950)
|
2,039
|
104.6
|
|
Income before income
taxes
|
$
|
28,248
|
$
|
29,639
|
(1,391)
|
(4.7)
|
|
$
|
101,266
|
$
|
87,225
|
14,041
|
16.1
|
|
Provision for income
taxes
|
|
5,607
|
|
4,517
|
1,090
|
24.1
|
|
|
19,938
|
|
14,977
|
4,961
|
33.1
|
|
Net Income for the
period
|
$
|
22,641
|
$
|
25,122
|
(2,481)
|
(9.9)
|
|
$
|
81,328
|
$
|
72,248
|
9,080
|
12.6
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic earnings per
share
|
|
0.41
|
|
0.45
|
(0.04)
|
(8.9)
|
|
|
1.47
|
|
1.31
|
0.16
|
12.2
|
|
Diluted earnings per
share
|
|
0.41
|
|
0.45
|
(0.04)
|
(8.9)
|
|
|
1.47
|
|
1.31
|
0.16
|
12.2
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash flows from
operating activities
|
|
31,583
|
|
28,318
|
3,265
|
11.5
|
|
|
132,071
|
|
115,298
|
16,773
|
14.5
|
|
Cash flows from
operating activities excluding changes in working
capital
|
|
40,270
|
|
43,504
|
(3,234)
|
(7.4)
|
|
|
151,803
|
|
140,492
|
11,311
|
8.1
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted
EBITDA
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Results from operating
activities
|
|
33,433
|
|
35,684
|
(2,251)
|
(6.3)
|
|
|
133,846
|
|
122,108
|
11,738
|
9.6
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation
|
|
655
|
|
627
|
28
|
4.5
|
|
|
2,347
|
|
2,451
|
(104)
|
(4.2)
|
|
Depreciation of
right-of-use assets
|
|
1,375
|
|
1,491
|
(116)
|
(7.8)
|
|
|
5,981
|
|
6,764
|
(783)
|
(11.6)
|
|
Special
charges
|
|
169
|
|
117
|
52
|
44.4
|
|
|
1,609
|
|
2,477
|
(868)
|
(35.0)
|
|
Adjusted
EBITDA
|
$
|
35,632
|
$
|
37,919
|
(2,287)
|
(6.0)
|
|
$
|
143,783
|
$
|
133,800
|
9,983
|
7.5
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted EBITDA
margin
|
|
28.3 %
|
|
30.8 %
|
|
|
|
|
28.6 %
|
|
29.5 %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted EBITDA per
diluted share
|
$
|
0.64
|
$
|
0.69
|
( 0.05)
|
(7.2)
|
|
$
|
2.60
|
$
|
2.42
|
0.18
|
7.4
|
|
Consolidated
Statements of Financial Position
|
|
(in thousands of
Canadian dollars)
|
|
As at
October 31, 2024
|
As at October 31,
2023
|
|
ASSETS
|
|
|
|
|
|
|
Current
assets:
|
|
|
|
|
|
|
Cash and
cash equivalents
|
|
$
|
274,240
|
$
|
239,532
|
|
Short-term
investments
|
|
|
487
|
|
827
|
|
Accounts
receivable
|
|
|
92,348
|
|
93,383
|
|
Prepaid
expenses and other assets
|
|
|
16,100
|
|
15,515
|
|
Income
taxes recoverable
|
|
|
-
|
|
114
|
|
|
|
383,175
|
|
349,371
|
|
Non-current
assets:
|
|
|
|
|
|
|
Property
and equipment
|
|
|
4,192
|
|
3,273
|
|
Right-of-use assets
|
|
|
11,473
|
|
12,242
|
|
Intangible
assets
|
|
|
98,594
|
|
109,659
|
|
Goodwill
|
|
|
309,831
|
|
280,241
|
|
Deferred
income tax assets
|
|
|
26,228
|
|
28,884
|
|
|
|
450,318
|
|
434,299
|
|
|
$
|
833,493
|
$
|
783,670
|
|
|
|
|
|
|
|
LIABILITIES AND
SHAREHOLDERS' EQUITY
|
|
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
|
|
Accounts
payable and accrued liabilities
|
|
$
|
70,087
|
$
|
67,769
|
|
Income tax
payable
|
|
|
5,525
|
|
-
|
|
Dividends
payable
|
|
|
14,397
|
|
12,156
|
|
Provisions
|
|
|
1,834
|
|
2,238
|
|
Deferred
revenue
|
|
|
114,080
|
|
109,019
|
|
Lease
obligations
|
|
|
5,344
|
|
6,322
|
|
|
|
211,267
|
|
197,504
|
|
Non-current
liabilities:
|
|
|
|
|
|
|
Income
taxes payable
|
|
|
-
|
|
1,333
|
|
Deferred
income tax liabilities
|
|
|
10,500
|
|
13,340
|
|
Deferred
revenue
|
|
|
8,094
|
|
8,170
|
|
Net
employee defined benefit obligation
|
|
|
2,081
|
|
1,912
|
|
Lease
obligations
|
|
|
5,744
|
|
6,080
|
|
|
|
26,419
|
|
30,835
|
|
|
|
237,686
|
|
228,339
|
|
Shareholders'
equity
|
|
|
|
|
|
|
Share
capital
|
|
|
118,217
|
|
107,701
|
|
Contributed surplus
|
|
|
9,764
|
|
10,404
|
|
Retained
earnings
|
|
|
446,748
|
|
426,397
|
|
Accumulated other comprehensive income
|
|
|
21,078
|
|
10,829
|
|
|
|
595,807
|
|
555,331
|
|
|
$
|
833,493
|
$
|
783,670
|
|
Consolidated Statement of Operations and
Comprehensive Income
|
|
(in thousands
of Canadian dollars, except per share
amounts)
|
|
|
|
|
Three
months
|
Twelve
months
|
|
Periods ended
October 31
|
|
2024
(unaudited)
|
2023
(Unaudited)
|
2024
|
2023
|
|
Revenue
|
|
|
|
|
|
|
Software licenses
|
|
$
15,860
|
$
17,467
|
$
72,906
|
$
80,054
|
|
SaaS and maintenance
services
|
|
88,196
|
87,196
|
346,579
|
297,635
|
|
Professional
services
|
|
18,469
|
16,483
|
70,046
|
67,273
|
|
Hardware
|
|
3,177
|
1,983
|
12,974
|
9,060
|
|
|
125,702
|
123,129
|
502,505
|
454,022
|
|
Direct
costs
|
|
|
|
|
|
|
Software licenses
|
|
397
|
622
|
3,501
|
2,910
|
|
Services
|
|
43,043
|
39,108
|
165,221
|
141,802
|
|
Hardware
|
|
1,527
|
1,483
|
6,864
|
5,287
|
|
|
44,967
|
41,213
|
175,586
|
149,999
|
|
Revenue, net of
direct costs
|
|
80,735
|
81,916
|
326,919
|
304,023
|
|
|
|
|
|
|
|
Operating
expenses
|
|
|
|
|
|
|
Selling, general and
administrative
|
|
22,642
|
23,702
|
94,303
|
90,889
|
|
Research and
development
|
|
22,461
|
20,295
|
88,833
|
79,334
|
|
Depreciation
|
|
655
|
627
|
2,347
|
2,451
|
|
Depreciation of right-of-use
assets
|
|
1,375
|
1,491
|
5,981
|
6,764
|
|
Special charges
|
|
169
|
117
|
1,609
|
2,477
|
|
|
47,302
|
46,232
|
193,073
|
181,915
|
|
|
|
|
|
|
|
Results from
operating activities
|
|
33,433
|
35,684
|
133,846
|
122,108
|
|
|
|
|
|
|
|
Amortization of
acquired software and customer
relationships
|
|
(9,322)
|
(11,205)
|
(40,505)
|
(39,605)
|
|
Foreign exchange gains
(losses)
|
|
1,870
|
2,753
|
(1,680)
|
1,266
|
|
Interest expense –
lease obligations
|
|
(126)
|
(164)
|
(556)
|
(695)
|
|
Finance
income
|
|
2,825
|
2,581
|
10,121
|
6,264
|
|
Finance
expenses
|
|
(8)
|
(27)
|
(49)
|
(163)
|
|
Other (expense)
income
|
|
(424)
|
17
|
89
|
(1,950)
|
|
Income before income
taxes
|
|
28,248
|
29,639
|
101,266
|
87,225
|
|
|
|
|
|
|
|
Provision for income
taxes
|
|
5,607
|
4,517
|
19,938
|
14,977
|
|
|
|
|
|
|
Net income for the
period
|
|
$
22,641
|
$
25,122
|
$
81,328
|
$
72,248
|
|
Items that may be
subsequently reclassified to income:
|
|
|
|
|
|
Cumulative translation
adjustment
|
|
2,882
|
12,394
|
10,249
|
19,800
|
|
|
|
|
|
|
|
Other comprehensive
income
|
|
2,882
|
12,394
|
10,249
|
19,800
|
|
|
|
|
|
|
|
Comprehensive
income
|
|
$
25,523
|
$
37,516
|
$
91,577
|
$
92,048
|
|
Earnings per
share
|
|
|
|
|
|
|
Basic
|
|
$
0.41
|
$ 0.45
|
$ 1.47
|
$ 1.31
|
|
Diluted
|
|
$
0.41
|
$ 0.45
|
$ 1.47
|
$ 1.31
|
|
Consolidated
Statements of Cash Flows
|
|
(in thousands
of Canadian dollars)
|
|
Three
months
|
Twelve
months
|
|
Periods ended
October 31
|
|
2024
(Unaudited)
|
2023
(Unaudited)
|
2024
|
2023
|
|
OPERATING
ACTIVITIES
|
|
|
|
|
|
|
Net income for the
period
|
|
$
22,641
|
$
25,122
|
$
81,328
|
$
72,248
|
|
Adjustments for
non-cash items
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation
|
|
655
|
627
|
2,347
|
2,451
|
|
Depreciation of right-of-use assets
|
|
1,375
|
1,491
|
5,981
|
6,764
|
|
Interest
expense – lease obligations
|
|
126
|
164
|
556
|
695
|
|
Amortization of acquired software and customer
relationships
|
|
9,322
|
11,205
|
40,505
|
39,605
|
|
Stock-based compensation expense
|
|
112
|
368
|
1,188
|
1,639
|
|
Provision
for income taxes
|
|
5,607
|
4,517
|
19,938
|
14,977
|
|
Finance
expenses and other (income) expense
|
|
432
|
10
|
(40)
|
2,113
|
|
|
40,270
|
43,504
|
151,803
|
140,492
|
|
|
|
|
|
|
|
Changes in non-cash
operating working capital
|
|
(7,674)
|
(11,624)
|
(7,920)
|
(11,244)
|
|
Income taxes
paid
|
|
(1,013)
|
(3,562)
|
(11,812)
|
(13,950)
|
|
Net cash provided by
operating activities
|
|
31,583
|
28,318
|
132,071
|
115,298
|
|
|
|
|
|
|
|
INVESTING
ACTIVITIES
|
|
|
|
|
|
|
Purchase of property
and equipment, net
|
|
(516)
|
(453)
|
(1,977)
|
(1,060)
|
|
Acquisitions, net of
cash acquired*
|
|
-
|
(27,189)
|
(43,448)
|
(55,167)
|
|
Recovery (payment) of
purchase consideration for prior-year acquisitions
|
|
-
|
13
|
171
|
(999)
|
|
Sale (purchase) of
short-term investments
|
|
-
|
65
|
-
|
(4)
|
|
Net cash used in
investing activities
|
|
(
516)
|
(27,564)
|
(45,254)
|
(57,230)
|
|
|
|
|
|
|
|
FINANCING
ACTIVITIES
|
|
|
|
|
|
|
Issuance of share
capital
|
|
2,990
|
-
|
9,085
|
604
|
|
Normal course issuer
bid share repurchases
|
|
(3,088)
|
(425)
|
(5,994)
|
(425)
|
|
Repayment of lease
obligations
|
|
(1,283)
|
(1,440)
|
(7,030)
|
(7,194)
|
|
Dividends
paid
|
|
(14,397)
|
(12,159)
|
(53,139)
|
(44,765)
|
|
Net cash used in
financing activities
|
|
(15,778)
|
(14,024)
|
(57,078)
|
(51,780)
|
|
Impact of foreign
exchange on cash and cash equivalents
|
|
1,238
|
4,018
|
4,969
|
8,140
|
|
|
|
|
|
|
|
Increase (decrease)
in cash and cash equivalents
|
|
16,527
|
(9,252)
|
34,708
|
14,428
|
|
Cash and cash
equivalents - beginning of period
|
|
257,713
|
248,784
|
239,532
|
225,104
|
|
Cash and cash
equivalents - end of period
|
|
$
274,240
|
$
239,532
|
$
274,240
|
$
239,532
|
* Acquisitions are net of cash acquired of nil and
$742 for the quarter and year ended
October 31, 2024, respectively and
nil and $2,088 for the quarter and
year ended October 31, 2023,
respectively.
Enghouse Systems Limited
Segment Reporting
Information
(in thousands of Canadian dollars)
|
For the period ended
October 31, 2024
|
|
Three
months
|
|
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
|
|
For the period ended
October 31, 2023
|
|
Three
months
|
|
Twelve
months
|
|
IMG
|
AMG
|
Total
|
IMG
|
AMG
|
Total
|
|
Revenue
|
$
|
78,578
|
$
|
44,551
|
$
|
123,129
|
$
|
265,311
|
$
|
188,711
|
$
|
454,022
|
|
Direct costs
|
|
(24,337)
|
|
(16,876)
|
|
(41,213)
|
|
(78,788)
|
|
(71,211)
|
|
(149,999)
|
|
Revenue, net of
direct costs
|
|
54,241
|
|
27,675
|
|
81,916
|
|
186,523
|
|
117,500
|
|
304,023
|
|
Operating expenses
excluding special charges
|
|
(21,807)
|
|
(10,450)
|
|
(32,257)
|
|
(84,493)
|
|
(45,169)
|
|
(129,662)
|
|
Depreciation
|
|
(485)
|
|
(142)
|
|
(627)
|
|
(1,969)
|
|
(482)
|
|
(2,451)
|
|
Depreciation of
right-of-use assets
|
|
(904)
|
|
(587)
|
|
(1,491)
|
|
(4,184)
|
|
(2,580)
|
|
(6,764)
|
|
Segment
profit
|
$
|
31,045
|
$
|
16,496
|
$
|
47,541
|
$
|
95,877
|
$
|
69,269
|
$
|
165,146
|
|
Special
charges
|
|
|
|
|
|
(117)
|
|
|
|
|
|
(2,477)
|
|
Corporate and shared
service expenses
|
|
|
|
|
|
(11,740)
|
|
|
|
|
|
(40,561)
|
|
Results from
operating activities
|
|
|
|
|
$
|
35,684
|
|
|
|
|
$
|
122,108
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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
cash flows from operating activities as the Company has no
outstanding 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
Friday, December 13, 2024 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: 59402 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
primarily related to acquisitions.
SOURCE Enghouse Systems Limited
