Earnings release
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Enghouse Releases Third Quarter Results Markham, Ontario – September 10, 2026 – Enghouse Systems Limited (TSX: ENGH) announces third quarter (unaudited) financial results for the period ended July 31, 2026. All figures are denominated in Canadian dollars unless otherwise indicated. Third Quarter Financial Highlights: • Revenue was $117.6 million as compared to $125.6 million in Q3 2025 and for the nine-month period was $352.0 million compared to $374.4 million last year; • Recurring revenue, which includes SaaS and maintenance services, was $81.7 million compared to $ 87.8 million in Q3 2025, and represents 69.5% of total revenue. For the nine-month period, recurring revenue was $245.4 million compared to $261.9 million in the prior period, and represents 69.7% of total revenue; • Results from operating activities were $24.5 million compared to $27.3 million in Q3 2025 and for the nine-month period were $76.4 million compared to $83.3 million in the prior year; • Net income was $15.4 million compared to $17.2 million in Q3 2025. For the nine-month period, net income was $49.2 million compared to $52.5 million in the prior period; • Adjusted EBITDA was $30.8 million compared to $32.3 million in Q3 2025, while achieving a 26.2% margin. For the nine-month period, Adjusted EBITDA was $88.4 million compared to $93.9 million in the prior year; • Net cash provided by operating activities , excluding changes in working capital and income taxes paid , was $28.4 million compared to $ 30.9 million in Q3 2025 and was $88.5 million for the nine-month period compared to $ 94.2 million last year. Cash, cash equivalents and short-term investments were $267.8 million as at July 31, 2026. During the quarter, Enghouse continued to operate in an environment shaped by evolving economic conditions, shifting trade dynamics, geopolitical developments and the ongoing impact of artificial intelligence on businesses worldwide. Against this backdrop, we remained focused on what we can control by executing our strategy, supporting our customers' critical operations, and enhancing our portfolio through targeted investments and innovation. Revenue increased compared to the second quarter of fiscal 2026 , reflecting improved business activity and the timing of certain transactions during the period. While some areas of the business continue to experience normal customer turnover and variabil ity in software license and hardware demand, our recurring revenu e streams remain a significant contributor to overall performance. The quarter reflects the benefits of our diversified portfolio, broad customer base, and disciplined approach to managing the bus iness through uncertain market conditions. As committed, we took steps to strengthen the Company's operating profile and long -term earnings potential. During the quarter, we implemented further actions to better align our cost structure with current activity levels and streamline operations across the Company, taking a $4.6 million restructuring charge. Operating expenses, excluding special charges, were $45.7 million compared to $49.9 million in the prior year, reflecting progress in our cost optimization efforts, with additional benefits expected to be realized in future periods. Enghouse ended the quarter with $267.8 million in cash, cash equivalents, and short -term investments, and no external debt. During the third quarter we paid dividends of $16.9 million and completed share buybacks of $7.5 million. The Company’s financial strength continues to provide significant strategic flexibility, allowing us to invest in our business, pursue acquisition opportunities, return capital to shareholders, and respond to changing market opportunities as they arise. Quarterly dividends: Today, the Board of Directors approved an eligible quarterly dividend of $0.31 per common share, payable on November 27, 2026, to shareholders of record at the close of business on November 13, 2026. NEWS
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Enghouse Systems Limited Financial Highlights (unaudited, in thousands of Canadian dollars) For the periods ended July 31 Three months Nine months 2026 2025 Var ($) Var (%) 2026 2025 Var ($) Var (%) Revenue $ 117,576 $ 125,577 (8,001) (6.4) $ 351,951 $ 374,396 (22,445) (6.0) Direct costs 42,742 45,409 (2,667) (5.9) 131,547 135,857 (4,310) (3.2) Revenue, net of direct costs $ 74,834 $ 80,168 (5,334) (6.7) $ 220,404 $ 238,539 (18,135) (7.6) As a % of revenue 63.6% 63.8% 62.6% 63.7% Operating expenses 45,722 49,905 (4,183) (8.4) 137,555 150,707 (13,152) (8.7) Special charges 4,645 3,008 1,637 54.4 6,482 4,500 1,982 44.0 Results from operating activities $ 24,467 $ 27,255 (2,788) (10.2) $ 76,367 $ 83,332 (6,965) (8.4) As a % of revenue 20.8% 21.7% 21.7% 22.3% Amortization of acquired software and customer relationships (6,143) (7,032) 889 12.6 (18,950) (22,807) 3,857 16.9 Foreign exchange gains (losses) 333 (580) 913 157.4 569 (2,233) 2,802 125.5 Interest expense – lease obligations (110) (132) 22 16.7 (343) (391) 48 12.3 Finance income 1,719 1,807 (88) (4.9) 4,878 6,024 (1,146) (19.0) Finance expenses (2) (16) 14 87.5 (77) (43) (34) (79.1) Other (expenses) income (415) 125 (540) (432.0) 1,040 1,625 (585) (36.0) Income before income taxes $ 19,849 $ 21,427 (1,578) (7.4) $ 63,484 $ 65,507 (2,023) (3.1) Provision for income taxes 4,472 4,254 218 5.1 14,319 12,969 1,350 10.4 Net Income for the period $ 15,377 $ 17,173 (1,796) (10.5) $ 49,165 $ 52,538 (3,373) (6.4) Basic earnings per share 0.28 0.31 (0.03) (9.7) 0.90 0.95 (0.05) (5.3) Diluted earnings per share 0.28 0.31 (0.03) (9.7) 0.90 0.95 (0.05) (5.3) Net cash provided by operating activities 22,475 27,087 (4,612) (17.0) 74,828 85,007 (10,179) (12.0) Net cash provided by operating activities excluding changes in working capital and income taxes paid 28,443 30,894 (2,451) (7.9) 88,539 94,178 (5,639) (6.0) Adjusted EBITDA Results from operating activities 24,467 27,255 (2,788) (10.2) 76,367 83,332 (6,965) (8.4) Depreciation 597 594 3 (0.5) 1,804 1,894 (90) 4.8 Depreciation of right-of-use assets 1,094 1,393 (299) 21.5 3,764 4,201 (437) 10.4 Special charges 4,645 3,008 1,637 (54.4) 6,482 4,500 1,982 (44.0) Adjusted EBITDA $ 30,803 $ 32,250 (1,447) (4.5) $ 88,417 $ 93,927 (5,510) (5.9) Adjusted EBITDA margin 26.2% 25.7% 25.1% 25.1% Adjusted EBITDA per diluted share $ 0.57 $ 0.58 (0.01) (1.7) $ 1.62 $ 1.70 (0.08) (4.7)
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Enghouse Systems Limited Condensed Consolidated Interim Statements of Financial Position (in thousands of Canadian dollars) (unaudited) As at July 31, 2026 As at October 31, 2025 ASSETS Current assets: Cash and cash equivalents $ 267,786 $ 269,061 Short-term investments 23 25 Accounts receivable 74,266 88,980 Prepaid expenses and other assets 13,199 17,001 355,274 375,067 Non-current assets: Property and equipment 3,510 3,890 Right-of-use assets 8,573 11,453 Intangible assets 75,438 89,710 Goodwill 344,454 341,593 Deferred income tax assets 36,132 35,105 468,107 481,751 $ 823,381 $ 856,818 LIABILITIES AND SHAREHOLDERS’ EQUITY Current liabilities: Accounts payable and accrued liabilities $ 57,496 $ 76,167 Income taxes payable 6,195 10,662 Dividends payable 16,709 16,426 Provisions 5,179 2,013 Deferred revenue 111,469 108,268 Lease obligations 4,015 5,197 201,063 218,733 Non-current liabilities: Deferred income tax liabilities 13,003 13,439 Deferred revenue 4,753 6,791 Net employee defined-benefit obligation 2,450 2,442 Lease obligations 4,009 5,944 24,215 28,616 225,278 247,349 Shareholders’ equity: Share capital 115,071 116,894 Contributed surplus 12,304 11,110 Retained earnings 429,576 443,134 Accumulated other comprehensive income 41,152 38,331 598,103 609,469 $ 823,381 $ 856,818
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Enghouse Systems Limited Condensed Consolidated Interim Statements of Operations and Comprehensive Income (in thousands of Canadian dollars, except per share amounts) (unaudited) Three months Nine months Periods ended July 31 2026 2025 2026 2025 Revenue Software licenses $ 17,349 $ 17,290 $ 49,267 $ 51,956 SaaS and maintenance services 81,675 87,753 245,399 261,874 Professional services 16,427 17,156 48,942 50,889 Hardware 2,125 3,378 8,343 9,677 117,576 125,577 351,951 374,396 Direct costs Software licenses 671 640 1,778 2,079 Services 40,942 43,410 125,613 129,338 Hardware 1,129 1,359 4,156 4,440 42,742 45,409 131,547 135,857 Revenue, net of direct costs 74,834 80,168 220,404 238,539 Operating expenses Selling, general and administrative 22,468 23,752 65,854 72,368 Research and development 21,563 24,166 66,133 72,244 Depreciation 597 594 1,804 1,894 Depreciation of right-of-use assets 1,094 1,393 3,764 4,201 Special charges 4,645 3,008 6,482 4,500 50,367 52,913 144,037 155,207 Results from operating activities 24,467 27,255 76,367 83,332 Amortization of acquired software and customer relationships (6,143) (7,032) (18,950) (22,807) Foreign exchange gains (losses) 333 (580) 569 (2,233) Interest expense – lease obligations (110) (132) (343) (391) Finance income 1,719 1,807 4,878 6,024 Finance expenses (2) (16) (77) (43) Other (expenses) income (415) 125 1,040 1,625 Income before income taxes 19,849 21,427 63,484 65,507 Provision for income taxes 4,472 4,254 14,319 12,969 Net income for the period 15,377 17,173 49,165 52,538 Item that may be subsequently reclassified to income: Cumulative translation adjustment 10,200 1,928 2,821 8,316 Other comprehensive income 10,200 1,928 2,821 8,316 Comprehensive income $ 25,577 $ 19,101 $ 51,986 $ 60,854 Earnings per share Basic $ 0.28 $ 0.31 $ 0.90 $ 0.95 Diluted $ 0.28 $ 0.31 $ 0.90 $ 0.95
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Enghouse Systems Limited Condensed Consolidated Interim Statements of Cash Flows *Acquisitions are net of cash acquired of $Nil and $83 for the three and nine months ended July 31, 2026, respectively, and $Nil and $9,287 for the three and nine months ended July 31, 2025, respectively. (in thousands of Canadian dollars) (unaudited) Three months Nine months Periods ended July 31 2026 2025 2026 2025 OPERATING ACTIVITIES Net income for the period $ 15,377 $ 17,173 $ 49,165 $ 52,538 Adjustments for non-cash items Depreciation 597 594 1,804 1,894 Depreciation of right-of-use assets 1,094 1,393 3,764 4,201 Interest expense – lease obligations 110 132 343 391 Amortization of acquired software and customer relationships 6,143 7,032 18,950 22,807 Stock-based compensation expense 233 425 1,157 960 Provision for income taxes 4,472 4,254 14,319 12,969 Finance expenses and other (income) expenses 417 (109) (963) (1,582) 28,443 30,894 88,539 94,178 Changes in non-cash operating working capital 133 (700) 7,472 3,670 Income taxes paid (6,101) (3,107) (21,183) (12,841) Net cash provided by operating activities 22,475 27,087 74,828 85,007 INVESTING ACTIVITIES Purchase of property and equipment, net (250) (372) (1,374) (1,179) Acquisitions, net of cash acquired* - - (5,524) (33,399) Payment of purchase consideration for prior-year acquisitions (2,188) - (3,677) - Proceeds from sale of intangible assets - - 701 - Net cash used in investing activities (2,438) ( 372) (9,874) (34,578) FINANCING ACTIVITIES Normal course issuer bid share repurchases (7,511) (1,579) (14,595) (7,529) Repayment of lease obligations (1,120) (1,561) (3,984) (4,770) Dividends paid (16,855) (16,547) (49,631) (45,284) Net cash used in financing activities (25,486) (19,687) (68,210) (57,583) Impact of foreign exchange on cash and cash equivalents 3,535 1,168 1,981 4,395 (Decrease) increase in cash and cash equivalents (1,914) 8,196 (1,275) (2,759) Cash and cash equivalents - beginning of period 269,700 263,285 269,061 274,240 Cash and cash equivalents - end of period $ 267,786 $ 271,481 $ 267,786 $ 271,481
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Enghouse Systems Limited Segment Reporting Information (in thousands of Canadian dollars) (unaudited) Three months ended July 31 2026 2025 IMG AMG Total IMG AMG Total Revenue $ 64,610 $ 52,966 $ 117,576 $ 69,625 $ 55,952 $ 125,577 Direct costs (22,053) (20,689) (42,742) (24,822) (20,587) (45,409) Revenue, net of direct costs 42,557 32,277 74,834 44,803 35,365 80,168 Operating expenses excluding special charges (20,105) (13,032) (33,137) (22,230) (14,259) (36,489) Depreciation (340) (257) (597) (356) (238) (594) Depreciation of right-of-use assets (592) (502) (1,094) (865) (528) (1,393) Segment profit $ 21,520 $ 18,486 $ 40,006 $ 21,352 $ 20,340 $ 41,692 Special charges (4,645) (3,008) Corporate and shared service expenses (10,894) (11,429) Results from operating activities $ 24,467 $ 27,255 Nine months ended July 31 2026 2025 IMG AMG Total IMG AMG Total Revenue $ 194,745 $ 157,206 $ 351,951 $ 216,964 $ 157,432 $ 374,396 Direct costs (67,362) (64,185) (131,547) (76,346) (59,511) (135,857) Revenue, net of direct costs 127,383 93,021 220,404 140,618 97,921 238,539 Operating expenses excluding special charges (62,443) (39,353) (101,796) (68,833) (41,194) (110,027) Depreciation (980) (824) (1,804) (1,151) (743) (1,894) Depreciation of right-of-use assets (2,219) (1,545) (3,764) (2,701) (1,500) (4,201) Segment profit $ 61,741 $ 51,299 $ 113,040 $ 67,933 $ 54,484 $ 122,417 Special charges (6,482) (4,500) Corporate and shared service expenses (30,191) (34,585) Results from operating activities $ 76,367 $ 83,332 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 Friday, September 11, 2026 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: 94138. A webcast is also available at: https://www.enghouse.com/investors.php.
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For further information please contact: Sam Anidjar Vice President, Corporate Development (905) 946-3200 investor@enghouse.com **** The Company uses non-IFRS measures to assess its operating performance. Securities regulations require that companies caution readers that earning s 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 ope rating 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 opera ting 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 cost s.