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D2L Inc. Announces Third Quarter 2025 Financial Results

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Subscription and support revenue grew 13% year-over-year to US$46.8 millionProfessional services and other revenue in the quarter increased to US$7.5 millionAnnual Recurring Revenue1 reached US$201.7 million, up 12% over the prior yearAdjusted EBITDA2 of US$10.4 million and Adjusted EBITDA margin2 of 19.2% margin in the quarterCompany increases Fiscal 2025 revenue guidance to $204 million to $205 million and increases Adjusted EBITDA guidance to $25.5 million to $26.5M million

TORONTO, Dec. 4, 2024 /CNW/ – D2L Inc. (TSX: DTOL) (“D2L” or the “Company”), a leading global learning technology company, today announced financial results for its Fiscal 2025 third quarter ended October 31, 2024. All amounts are in U.S. dollars and all figures are prepared in accordance with International Financial Reporting Standards (“IFRS”) unless otherwise indicated.

“Our strong third-quarter results were highlighted by healthy growth in subscription revenue and significant margin expansion, driving substantial improvement in our ‘Rule of 40’ performance as we successfully balance growth and market share gains with improving profitability,” said John Baker, CEO of D2L. “We continue to benefit from high win rates in our target markets as we navigate the broader macroeconomic conditions. We’re making disciplined investments that support our goal of long-term market leadership, and have seen strong customer response and pipeline generation from our recently expanded product portfolio, including our AI offering Lumi and Creator+. These new products make learning experiences better and easier to create for our customers, leading to improved learning outcomes and better learner retention.”

Third Quarter Fiscal 2025 Financial Highlights

Total revenue was $54.3 million, up 18% from the same period in the prior year.Subscription and support revenue was $46.8 million, an increase of 13% over the same period of the prior year.Professional services and other revenue was $7.5 million, an increase of $2.8 million from the same period of the prior year. During the current quarter, the Company recognized services revenue of $1.2 million from re-evaluating the completion progress of certain professional services engagements. Excluding this revenue, services revenue increased by $1.6 million over the prior year, and total revenue increased by $7.1 million or 15.2% year over year. Annual Recurring Revenue1 as at October 31, 2024 increased by 12% or $21.6 million year-over-year, from $180.1 million to $201.7 million.Cash flow from operating activities was $11.4 million, compared to $15.3 million in the same period in the prior year, and Free Cash Flow2 was $11.3 million, compared to $14.2 million in the same period in the prior year.Cash flow from operating activities for the 9-month period ended October 31, 2024 was $28.0 million, up 32% compared with $21.2 million for the same period in the prior year.  Gross profit increased 22% to $37.4 million (68.9% gross profit margin) from $30.6 million (66.4% gross profit margin) in the same period of the prior year. Gross profit margin for subscription and support revenue increased to 72.7%, up 140 basis points from 71.3% in the same period of the prior year.Adjusted EBITDA2 increased to $10.4 million (19.2% Adjusted EBITDA margin2) from $2.1 million (4.6%) for the same period in the prior year. Excluding the additional services revenue of $1.2 million recognized in the quarter, Adjusted EBITDA and Adjusted EBITDA Margin would have been $9.2 million and 17.4%, respectively, for the three months ended October 31, 2024. Income for the period was $5.5 million, compared with a loss of $0.4 million for the comparative period of the prior year.Strong balance sheet at quarter end, with cash and cash equivalents of $108.3 million and no debt. During the third quarter, the Company repurchased and canceled 68,600 Subordinate Voting Shares under its normal course issuer bid (“NCIB”). The Company has repurchased and cancelled 348,080 shares since the inception of the NCIB on December 8, 2023.On December 4, 2024, the Company announced that the Toronto Stock Exchange (the “TSX”) accepted the Company’s notice to launch a new NCIB, commencing on December 9, 2024.

1 Refer to “Key Performance Indicators” section of this press release.

2 A non-IFRS financial measure or non-IFRS ratio.  Refer to “Non IFRS Financial Measures” section of this press release.

Third Quarter Fiscal 2025 Financial Results – Selected Financial Measures
(in thousands of U.S. dollars, except for percentages)

Three months ended October 31

Nine months ended October 31

2024

2023

Change

Change

2024

2023

Change

Change

$

$

$

%

$

$

$

%

Subscription & Support Revenue

46,752

41,450

5,302

12.8 %

133,723

120,045

13,678

11.4 %

Professional Services & Other Revenue

7,547

4,663

2,884

61.8 %

18,240

14,766

3,474

23.5 %

Total Revenue

54,299

46,113

8,186

17.8 %

151,963

134,811

17,152

12.7 %

Constant Currency Revenue1

54,106

46,113

7,993

17.3 %

152,126

134,811

17,315

12.8 %

Gross Profit

37,390

30,600

6,790

22.2 %

103,441

90,161

13,280

14.7 %

Adjusted Gross Profit 1

37,964

30,778

7,186

23.3 %

104,439

90,622

13,817

15.2 %

Adjusted Gross Margin1

69.9 %

66.7 %

68.7 %

67.2 %

Income (Loss) for the period

5,547

(387)

5,934

1,533.3 %

5,857

(4,105)

9,962

242.7 %

Adjusted EBITDA1

10,420

2,122

8,298

391.0 %

18,652

4,399

14,253

324.0 %

Cash Flows From Operating Activities

11,420

15,318

(3,898)

(25.5 %)

28,037

21,171

6,866

32.4 %

Free Cash Flow1

11,296

14,244

(2,948)

(20.7 %)

27,567

16,009

11,558

72.2 %

1 A non-IFRS financial measure or non-IFRS ratio.  Refer to the “Non-IFRS Financial Measures and Reconciliation of Non-IFRS Financial Measures” section of this press release for more details.

Third Quarter Business & Operating Highlights

D2L continued to grow its customer base in education in North America, including the additions of the Cincinnati State Technical and Community College, University of the Fraser Valley, and Prairie View A&M University.D2L continued to expand its international customer base, including XP Educação in Brazil and the main statutory body overseeing legal education and training in New Zealand.Signed new corporate customers, including Becoming Institute and the premier academic trauma surgery organization in the United States.Launched Creator+ natively integrated with H5P Group AS (“H5P”), offering an all-in-one solution for creating engaging courses with interactive content, video tools, dynamic analytics, and generative AI. Early adopters include the University of Hawaiʻi System.The Tambellini Group, the leading analyst and advisory firm focused on higher education, ranked D2L Brightspace highest among competitors for usability and innovation in the inaugural Tambellini StarChart™ 2024 for Learning Management Systems (“LMS”) in higher education.Named a winner in the 2024 LMS Top 20 Company by Training Industry and a winner in the 2024 Learning Systems Awards for Best Enterprise LMS by Talented Learning.D2L Lumi was named a winner of the Tech & Learning Awards of Excellence: Back to School 2024 in the Primary and Higher Education categories.Announced a strategic partnership with Seesaw, the leading elementary Learning Experience Platform to enhance the K-12 digital learning experience.

Financial Outlook
D2L updated its previously issued financial guidance for the year ended January 31, 2025 (“Fiscal 2025”) as follows:

Subscription and support revenue in the range of $180 million to $181 million, implying growth of 11% at the midpoint over Fiscal 2024, an increase from previously issued guidance of $178 million to $181 million;Total revenue in the range of $204 million to $205 million, implying growth of 12% at the midpoint over Fiscal 2024, an increase from previously issued guidance of $199 million to $202 million; andAdjusted EBITDA in the range of $25.5 million to $26.5 million, implying Adjusted EBITDA margin of 13% at the midpoint, an increase from previously issued guidance of $22 million to $24 million.

These guidance revisions reflect the Company’s continued progress in balancing revenue growth with operating efficiency improvements.

For additional details on the Company’s outlook, including the principal underlying assumptions and risk factors regarding achievement, refer to the “Financial Outlook” section of the Company’s Management’s Discussion and Analysis for the three and 12 months ended January 31, 2024 (the “Annual MD&A”), as well as the “Forward-Looking Information” section therein, below and in the Company’s Management’s Discussion and Analysis for the three months ended October 31, 2024 (the “Interim MD&A”).

Conference Call & Webcast
D2L management will host a conference call on Thursday, December 5, 2024 at 8:30 am ET to discuss its third quarter Fiscal 2025 financial results.

Date:

Thursday, December 5, 2024

Time:

8:30 am (ET)

Dial in number:

Canada/US: 1 (833) 470-1428

International: 1 (404) 975-4839

Access code: 027545

Webcast:

A live webcast will be available at ir.d2l.com/events-and-presentations/events/

The webcast will also be archived

Forward-Looking Information
This press release includes statements containing “forward-looking information” within the meaning of applicable securities laws. In some cases, forward-looking information can be identified by the use of forward-looking terminology such as “plans”, “expects”, “budget”, “scheduled”, “estimates”, “outlook”, “target”, “forecasts”, “projection”, “potential”, “prospects”, “strategy”, “intends”, “anticipates”, “seek”, “believes”, “opportunity”, “guidance”, “aim”, “goal” or variations of such words and phrases or statements that certain future conditions, actions, events or results “may”, “could”, “would”, “should”, “might”, “will”, “can”, or negative versions thereof, “be taken”, “occur”, “continue” or “be achieved”, and other similar expressions. Statements containing forward-looking information are not historical facts, but instead represent management’s expectations, estimates and projections regarding future events or circumstances.  

This forward-looking information relates to the Company’s future financial outlook and anticipated events or results and includes, but is not limited to, statements under the heading “Financial Outlook” and information regarding: the Company’s financial position, financial results, business strategy, performance, achievements, prospects, objectives, opportunities, business plans and growth strategies, including the Company’s balance growth and profitability plan;  the Company’s budgets, operations and taxes; judgments and estimates impacting the financial statements; the markets in which the Company operates; industry trends and the Company’s competitive position; and expansion of the Company’s product offerings, including the impact of AI offerings on the Company’s addressable market and revenue opportunity.

Forward-looking information is based on certain assumptions, expectations and projections, and analyses made by the Company in light of management’s experience and perception of historical trends, current conditions and expected future developments and other factors it believes are appropriate, including the following: the Company’s ability to win business from new customers and expand business from existing customers; the timing of new customer wins and expansion decisions by existing customers; the Company’s ability to generate revenue and expand its business while controlling costs and expenses; the Company’s ability to manage growth effectively; the Company’s ability to hire and retain personnel effectively; the effects of foreign currency exchange rate fluctuations on our operations; the ability to seek out, enter into and successfully integrate acquisitions, including the acquisition of H5P; business and industry trends, including the success of current and future product development initiatives; positive social development and attitudes toward the pursuit of higher education; the Company’s ability to maintain positive relationships with its customer base and strategic partners; the Company’s ability to adapt and develop solutions that keep pace with continuing changes in technology, education and customer needs; the ability to patent new technologies and protect intellectual property rights; the Company’s ability to comply with security, cybersecurity and accessibility laws, regulations and standards; the assumptions underlying the judgments and estimates impacting on financial statements; and the Company’s ability to retain key personnel; the factors and assumptions discussed under the “Financial Outlook” section of the Annual MD&A, and that the list of factors referenced in the following paragraph, collectively, do not have a material impact on the Company.

Although the Company believes that the assumptions underlying such forward-looking information were reasonable when made, they are inherently uncertain and are subject to significant risks and uncertainties and may prove to be incorrect. The Company cautions investors that forward-looking information is not a guarantee of the future and that actual results may differ materially from those made in or suggested by the forward-looking information contained in this press release. Whether actual results, performance or achievements will conform to the Company’s expectations and predictions is subject to a number of known and unknown risks, uncertainties and other factors, including but not limited to the risks identified herein, or at “Summary of Factors Affecting Our Performance” of the Company’s Interim MD&A or in the “Risk Factors” section of the Company’s most recently filed annual information form, in each case filed under the Company’s profile on SEDAR+ at www.sedarplus.com. If any of these risks or uncertainties materialize, or if assumptions underlying the forward-looking information prove incorrect, actual results might vary materially from those anticipated in the forward-looking information.

Given these risks and uncertainties, investors are cautioned not to place undue reliance on forward-looking information, including any financial outlook. Any forward-looking information that is contained in this press release speaks only as of the date of such statement, and the Company undertakes no obligation to update any forward-looking information or to publicly announce the results of any revisions to any of those statements to reflect future events or developments, except as required by 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. 

About D2L Inc. (TSX: DTOL)

D2L is transforming the way the world learns, helping learners achieve more than they dreamed possible. Working closely with customers all over the world, D2L is on a mission to make learning more inspiring, engaging and human. Find out how D2L helps transform lives and delivers outstanding learning outcomes in K-12, higher education and business at www.D2L.com.

D2L Inc.
Condensed Consolidated Interim Statements of Financial Position
(In U.S. dollars)

As at October 31, 2024 and January 31, 2024
(Unaudited)

October 31, 2024

January 31, 2024

Assets

Current assets:

Cash and cash equivalents

$   108,252,331

$    116,943,499

Trade and other receivables

20,379,489

23,025,690

Uninvoiced revenue

3,896,203

3,971,861

Prepaid expenses

6,559,188

10,517,226

Deferred commissions

5,134,323

5,334,864

144,221,534

159,793,140

Non-current assets:

Other receivables

480,621

537,056

Prepaid expenses

381,939

119,872

Deferred income taxes

573,268

529,674

Right-of-use assets

8,127,082

8,774,960

Property and equipment

7,402,295

8,427,734

Deferred commissions

7,449,801

7,730,724

Investment in associate

21,248

Loan receivable from associate

5,120,885

Intangible assets

18,073,003

770,707

Goodwill

26,379,860

10,440,091

Total assets

$    218,231,536

$    197,123,958

Liabilities and Shareholders’ Equity

Current liabilities:

Accounts payable and accrued liabilities

$     28,615,437

$    32,635,926

Deferred revenue

105,842,166

93,727,368

Lease liabilities

1,396,079

1,002,464

Contingent consideration

4,893,539

271,479

140,747,221

127,637,237

Non-current liabilities:

Deferred income taxes

4,119,188

587,075

Lease liabilities

10,660,223

11,707,534

Contingent consideration

311,839

14,779,411

12,606,448

155,526,632

140,243,685

Shareholders’ equity:

Share capital

367,288,877

364,830,884

Additional paid-in capital

48,190,065

47,485,107

Accumulated other comprehensive loss

(7,333,643)

(4,998,317)

Deficit

(345,440,395)

(350,437,401)

62,704,904

56,880,273

Related party transactions

Subsequent event

Total liabilities and shareholders’ equity

$    218,231,536

$   197,123,958

D2L INC.
Condensed Consolidated Interim Statements of Comprehensive Income (Loss)
(In U.S. dollars)                                                                                                                              

For the three and nine months ended October 31, 2024 and 2023
(Unaudited)

Three months ended October 31

Nine months ended October 31

2024

2023

2024

2023

Revenue:

Subscription and support

$ 46,751,998

$ 41,449,926

$ 133,723,027

$ 120,045,266

Professional service and other

7,547,470

4,662,769

18,239,685

14,765,509

54,299,468

46,112,695

151,962,712

134,810,775

Cost of revenue:

Subscription and support

12,777,133

11,884,640

36,651,859

33,977,839

Professional services and other

4,132,232

3,627,638

11,870,394

10,671,456

16,909,365

15,512,278

48,522,253

44,649,295

Gross profit

37,390,103

30,600,417

103,440,459

90,161,480

Expenses:

Sales and marketing

12,806,266

12,807,855

40,302,476

40,209,601

Research and development

11,139,920

12,351,201

35,294,478

36,015,722

General and administrative

8,651,729

7,102,165

25,231,988

20,603,875

32,597,915

32,261,221

100,828,942

96,829,198

Income (loss) from operations

4,792,188

(1,660,804)

2,611,517

(6,667,718)

Interest and other income (expense):

Interest expense

(235,892)

(157,582)

(550,438)

(456,456)

Interest income

870,355

1,221,704

2,899,093

2,938,216

Other income (expense)

(122,043)

(10,355)

(122,000)

4,897

Gain on SkillsWave disposal transaction

917,395

Foreign exchange gain

224,145

314,938

307,859

380,417

736,565

1,368,705

3,451,909

2,867,074

Income (loss) before income taxes

5,528,753

(292,099)

6,063,426

(3,800,644)

Income taxes (recovery):

Current

246,162

43,883

602,830

435,294

Deferred

(264,457)

51,613

(396,134)

(130,838)

(18,295)

95,496

206,696

304,456

Income (loss) for the period

5,547,048

(387,595)

5,856,730

(4,105,100)

Other comprehensive gain (loss):

Foreign currency translation gain (loss)

137,532

(1,556,171)

(2,335,326)

(1,020,872)

Comprehensive income (loss)

$ 5,684,580

$ (1,943,766)

$ 3,521,404

$ (5,125,972)

Earnings (loss) per share – basic

$     0.10

$     (0.01)

$    0.11

$    (0.08)

Earnings (loss) per share – diluted

$     0.10

$     (0.01)

$   0.10

$    (0.08)

Weighted average number of common shares
     – basic

54,453,244

53,703,768

54,282,281

53,454,498

Weighted average number of common shares
     – diluted

56,032,694

53,703,768

55,828,067

53,454,498

D2L INC.
Condensed Consolidated Interim Statements of Shareholders’ Equity
(In U.S. dollars)

For the nine months ended October 31, 2024 and 2023
(Unaudited)

Share Capital

Additional
paid-in
capital

Accumulated
other
comprehensive
loss

Deficit

Total

Shares

Amount

Balance, January 31, 2024

53,978,085

$  364,830,884

$  47,485,107

$  (4,998,317)

$  (350,437,401)

$  56,880,273

Issuance of Subordinate Voting Shares on
     exercise of options

410,397

3,443,979

(1,804,429)

1,639,550

Issuance of Subordinate Voting Shares on
     settlement of restricted share units

374,307

1,416,155

(4,602,395)

(3,186,240)

Stock-based compensation

7,111,782

7,111,782

Repurchase of share capital for
     cancellation under NCIB

(306,880)

(2,402,141)

(2,402,141)

Change in share repurchase commitment
     under ASPP

(859,724)

(859,724)

Other comprehensive loss

(2,335,326)

(2,335,326)

Income for the period

5,856,730

5,856,730

Balance, October 31, 2024

54,455,909

$  367,288,877

$  48,190,065

$  (7,333,643)

$  (345,440,395)

$  62,704,904

Balance, January 31, 2023

53,146,530

357,639,824

46,084,161

(5,001,805)

(344,630,902)

54,091,278

Issuance of Subordinate Voting Shares on
     exercise of options

381,794

3,414,019

(1,443,627)

1,970,392

Issuance of Subordinate Voting Shares on
     settlement of restricted share units

218,010

988,410

(2,474,669)

(1,486,259)

Stock-based compensation

7,237,274

7,237,274

Other comprehensive loss

(1,020,872)

(1,020,872)

Loss for the period

(4,105,100)

(4,105,100)

Balance, October 31, 2023

53,746,334

$   362,042,253

$   49,403,139

$   (6,022,677)

$  (348,736,002)

$   56,686,713

D2L INC.
Condensed Consolidated Interim Statements of Cash Flows
(In U.S. dollars)

For the nine months ended October 31, 2024 and 2023
(Unaudited)

2024

2023

Operating activities:

Income (loss) for the period

$  5,856,730

$  (4,105,100)

Items not involving cash:

Depreciation of property and equipment

1,285,970

1,158,782

Depreciation of right-of-use assets

945,223

927,605

Amortization of intangible assets

723,100

60,159

Gain on disposal of property and equipment

(51,476)

(16,194)

Stock-based compensation

7,111,782

7,237,274

Net interest income

(2,348,655)

(2,481,760)

Income tax expense

206,696

304,456

Gain on SkillsWave disposal transaction

(917,395)

Loss from equity accounted investee

416,850

Fair value gain on loan receivable from associate

(120,885)

Changes in operating assets and liabilities:

Trade and other receivables

3,784,969

1,041,252

Uninvoiced revenue

(37,023)

(440,936)

Prepaid expenses

3,503,610

1,073,501

Deferred commissions

296,245

(1,105,606)

Accounts payable and accrued liabilities

(6,410,785)

1,952,832

Deferred revenue

11,573,770

13,243,128

Right-of-use assets and lease liabilities

(44,962)

(57,530)

Interest received

2,878,878

2,938,216

Interest paid

(19,343)

(9,815)

Income taxes paid

(596,646)

(549,475)

Cash flows from operating activities

28,036,653

21,170,789

Financing activities:

Payment of lease liabilities

(1,344,625)

(575,023)

Lease incentive received

103,128

935,025

Proceeds from exercise of stock options

1,639,550

1,970,392

Taxes paid on settlement of restricted share units

(3,186,240)

(1,486,259)

Repurchase of share capital for cancellation under NCIB

(2,402,141)

Cash flows (used in) from financing activities

(5,190,328)

844,135

Investing activities:

Purchase of property and equipment

(521,775)

(5,178,461)

Proceeds from disposal of property and equipment

51,476

16,537

Acquisition of business, net of cash acquired

(22,308,927)

(2,793,180)

Payment of contingent consideration

(249,436)

Transfer of cash on disposal of SkillsWave

(1,483,357)

Proceeds from sale of majority ownership stake in SkillsWave

809,038

Issuance of loan to SkillsWave

(5,000,000)

Cash flows used in investing activities

(28,702,981)

(7,955,104)

Effect of exchange rate changes on cash and cash equivalents

(2,834,512)

(1,701,358)

(Decrease) increase in cash and cash equivalents

(8,691,168)

12,358,462

Cash and cash equivalents, beginning of period

116,943,499

110,732,236

Cash and cash equivalents, end of period

$ 108,252,331

$ 123,090,698

Non-IFRS Financial Measures and Reconciliation of Non-IFRS Financial Measures
The information presented within this press release refers to certain non-IFRS financial measures (including non-IFRS ratios) including Adjusted EBITDA, Adjusted EBITDA Margin, Adjusted Gross Profit, Adjusted Gross Margin, Free Cash Flow, Free Cash Flow Margin, and Constant Currency Revenue. These measures are not recognized measures under IFRS and do not have a standardized meaning prescribed by IFRS. Non-IFRS financial measures should not be considered in isolation nor as a substitute for analysis of the Company’s financial information reported under IFRS and are unlikely to be comparable to similar measures presented by other issuers. Rather, these measures are provided as additional information to complement those IFRS measures by providing further understanding of the Company’s results of operations, financial performance and liquidity from management’s perspective and thus highlight trends in its core business that may not otherwise be apparent when relying solely on IFRS measures. The Company believes that securities analysts, investors and other interested parties frequently use non-IFRS financial measures in the evaluation of the Company. The Company’s management also uses non-IFRS financial measures to facilitate operating performance comparisons from period to period, to prepare annual operating budgets and forecasts, and to assess our ability to meet our capital expenditures and working capital requirements.

Adjusted EBITDA and Adjusted EBITDA Margin
Adjusted EBITDA is defined as net income (loss), excluding interest, taxes, depreciation and amortization (or EBITDA), adjusted for stock-based compensation, foreign exchange gains and losses, non-recurring expenses, transaction-related costs, fair value adjustment of acquired deferred revenue, income (loss) from equity accounted investee, change in fair value on the loan receivable from associate, impairment charges and other income and losses. Adjusted EBITDA Margin is calculated as Adjusted EBITDA expressed as a percentage of total revenue. For an explanation of recent changes to and management’s use of Adjusted EBITDA and Adjusted EBITDA Margin see “Non-IFRS and Other Financial Measures – Non-IFRS Financial Measures and Non-IFRS Financial Ratios – Adjusted EBITDA and Adjusted EBITDA Margin” section in the Company’s Interim MD&A, which section is incorporated by reference herein.

The following table reconciles Adjusted EBITDA to income (loss) for the period, and discloses Adjusted EBITDA Margin, for the periods indicated:

(in thousands of U.S. dollars, except for percentages) 

Three months ended October 31 

Nine months ended October 31 

2024

2023

2024

2023

Income (loss) for the period 

5,547

(387)

5,857

(4,105)

Stock-based compensation 

2,195

2,068

7,112

7,237

Foreign exchange gains  

(224)

(315)

(308)

(380)

Non-recurring expenses(1)  

305

807

2,171

957

Transaction-related costs(2)  

1,249

169

2,072

721

Fair value adjustment of acquired deferred revenue 

500

639

Change in fair value on loan receivable from
     associate 

(121)

(121)

Loss from equity accounted investee 

320

417

Net interest income  

(634)

(1,064)

(2,348)

(2,482)

Income tax (recovery) expense 

(18)

95

207

304

Depreciation and amortization 

1,301

749

2,954

2,147

Adjusted EBITDA 

10,420

2,122

18,652

4,399

Adjusted EBITDA Margin 

19.2 %

4.6 %

12.3 %

3.3 %

During the current quarter, the Company recognized services revenue of $1.2 million from re-evaluating the completion progress of certain professional services engagements. Excluding this increase, the Company’s Adjusted EBITDA and Adjusted EBITDA Margin would have been $9.2 million and 17.4%, respectively, for the three months ended October 31, 2024.

Notes:

(1)

These expenses relate to non-recurring activities, such as certain legal fees incurred that are not indicative of continuing operations, and changes of workforce or technology whereby certain functions were realigned to optimize operations.

(2)

These expenses include certain legal and professional fees that were incurred in connection with acquisition and other strategic transactions, including the disposal of our majority ownership stake in SkillsWave Corporation (“Skillswave”) and our acquisition of H5P. These expenses also include post-combination compensation costs from the acquisition of H5P. These expenses are net of a gain of $0.9 million recognized on the disposal of our majority ownership stake in SkillsWave. These expenses would not have been incurred if not for these transactions and are not considered expenses indicative of the Company’s continuing operations.

Adjusted Gross Profit and Adjusted Gross Margin
Adjusted Gross Profit is defined as gross profit excluding related stock-based compensation expenses and amortization from recently acquired intangible assets, specifically acquired technology. Adjusted Gross Margin is calculated as Adjusted Gross Profit expressed as a percentage of total revenue. For an explanation of management’s use of Adjusted Gross Profit and Adjusted Gross Margin see “Non-IFRS and Other Financial Measures – Non-IFRS Financial Measures and Non-IFRS Financial Ratios – Adjusted Gross Profit and Adjusted Gross Margin” section in the Company’s Interim MD&A, which section is incorporated by reference herein.

The following table reconciles Adjusted Gross Margin to gross profit expressed as a percentage of revenue, for the periods indicated:

(in thousands of U.S. dollars, except for
     percentages) 

Three months ended October 31 

Nine months ended October 31 

2024

2023

2024

2023

Gross profit for the period  

37,390

30,600

103,441

90,161

Stock-based compensation 

147

147

442

430

Acquired intangible asset amortization 

427

31

556

31

Adjusted Gross Profit 

37,964

30,778

104,439

90,622

Adjusted Gross Margin 

69.9 %

66.7 %

68.7 %

67.2 %

During the current quarter, the Company recognized services revenue of $1.2 million from re-evaluating the completion progress of certain professional services engagements. Excluding this revenue, the Company’s Adjusted Gross Profit and Adjusted Gross Margin would have been $36.8 million and 69.2% respectively, for the three months ended October 31, 2024.

Free Cash Flow and Free Cash Flow Margin
Free Cash Flow is defined as cash provided by (used in) operating activities less net additions to property and equipment. Free Cash Flow Margin is calculated as Free Cash Flow expressed as a percentage of total revenue. For an explanation of management’s use of Free Cash Flow and Free Cash Flow Margin see “Non-IFRS and Other Financial Measures – Non-IFRS Financial Measures and Non-IFRS Financial Ratios – Free Cash Flow and Free Cash Flow Margin” section in the Company’s Interim MD&A, which section is incorporated by reference herein.

The following table reconciles our cash flow from (used in) operating activities to Free Cash Flow, and discloses Free Cash Flow Margin, for the periods indicated:

(in thousands of U.S. dollars, except for
     percentages) 

Three months ended October 31

Nine months ended October 31

2024

2023

2024

2023

Cash flow from operating activities 

11,420

15,318

28,037

21,171

Net addition to property and equipment 

(124)

(1,074)

(470)

(5,162)

Free Cash Flow 

11,296

14,244

27,567

16,009

Free Cash Flow Margin 

20.8 %

30.9 %

18.1 %

11.9 %

Constant Currency Revenue
Constant Currency Revenue is defined as foreign-currency-denominated revenues translated at the historical exchange rates from the comparable prior period into our U.S. dollar functional currency. For an explanation of management’s use of Constant Currency Revenue see “Non-IFRS and Other Financial Measures – Non-IFRS Financial Measures and Non-IFRS Financial Ratios – Constant Currency Revenue” section in the Company’s Interim MD&A, which section is incorporated by reference herein.

The following table reconciles our Constant Currency Revenue to revenue, for the periods indicated:

Three months ended October 31 

Nine months ended October 31 

(in thousands of U.S. dollars) 

2024

2023

2024

2023

$

$

$

$

Total revenue for the period 

54,299

46,113

151,963

134,811

(Positive) negative impact of foreign exchange rate
     changes over the prior period 

(193)

163

Constant Currency Revenue 

54,106

46,113

152,126

134,811

During the current quarter, the Company recognized services revenue of $1.2 million from re-evaluating the completion progress of certain professional services engagements. Excluding this increase, the Company’s constant currency revenue would have been $52.9 million for the three months ended October 31, 2024.

Key Performance Indicators

Management uses a number of metrics, including the key performance indicators identified below, to help us evaluate our business, measure our performance, identify trends affecting our business, formulate business plans and make strategic decisions. Our key performance indicators may be calculated in a manner different than similar key performance indicators used by other issuers. These metrics are estimated operating metrics and not projections, nor actual financial results, and are not indicative of current or future performance.

Annual Recurring Revenue and Constant Currency Annual Recurring Revenue: We define Annual Recurring Revenue as the annualized equivalent value of subscription revenue from all existing customer contracts as at the date being measured, exclusive of the implementation period. Our calculation of Annual Recurring Revenue assumes that customers will renew their contractual commitments as those commitments come up for renewal. We believe Annual Recurring Revenue provides a reasonable, real-time measure of performance in a subscription-based environment and provides us with visibility for potential growth to our cash flows. We believe that increasing Annual Recurring Revenue indicates the continued strength in the expansion of our business, and will continue to be our focus on a go-forward basis. We define Constant Currency Annual Recurring Revenue as foreign-currency-denominated Annual Recurring Revenue translated at the historical exchange rates from the comparable prior period into our U.S. dollar functional currency.

As at October 31

(in millions of U.S. dollars, except percentages)

2024

2023

Change

$

$

%

Annual Recurring Revenue

201.7

180.1

12.0 %

Constant Currency Annual Recurring Revenue

200.7

180.1

11.4 %

SOURCE D2L Inc.

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Air Products to Expand Integrated Gas Supply Network for Semiconductor Manufacturer in Taiwan

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New investment to support next-generation facility expansion

TAIPEI, July 22, 2026 /PRNewswire/ — Air Products (NYSE:APD), a world-leading industrial gases company, today announced Air Products San Fu has been awarded a long-term agreement to support a semiconductor manufacturer’s expansion in Taiwan. The project will supply multiple new semiconductor fabs and back-end packaging facilities, supporting growing demand driven by artificial intelligence and high-performance computing.

Air Products San Fu will build, own, and operate four large state-of-the-art air separation units and bulk gas supply systems with new underground pipeline systems. The company will supply a range of industrial gases, including nitrogen, oxygen, argon, and helium to support the customer’s semiconductor operations.

The new underground pipeline systems will be connected to Air Products’ existing pipeline network in Taiwan, further enhancing supply reliability, operational efficiency, and resilience.  

“Air Products is honored to be selected by our strategic customer to support their continued growth, building on our proven track record and strong long-term partnership,” said Paul Yang, President, Air Products San Fu. “This project further reinforces our role as a trusted supplier in Taiwan and reflects our long-term commitment to grow with our customers. It also underscores our world-class performance in safety, reliability and operational excellence, which are critical to meeting the increasingly demanding requirements of the electronics industry.”

Air Products has been serving the Taiwan market through Air Products San Fu for more than 70 years and has established leading supply positions across key science parks with extensive pipeline networks. The company operates one of the world’s largest ultra-high purity nitrogen pipeline systems in Southern Taiwan and is the first gas company in Taiwan awarded ISO9002 and ISO14000 certifications. 

This latest project further strengthens Air Products’ integrated supply footprint across both front-end semiconductor manufacturing and back-end advanced packaging, reinforcing its position as a key supplier to the electronics industry in Taiwan.

Air Products has served the global electronics industry for more than 40 years, supplying industrial gases safely and reliably to many of the world’s leading technology companies.

About Air Products

Air Products (NYSE: APD) is a world-leading industrial gases company in operation for over 85 years focused on serving energy, environmental, and emerging markets and generating a cleaner future. The Company supplies essential industrial gases, related equipment and applications expertise to customers in dozens of industries, including refining, chemicals, metals, electronics, manufacturing, medical and food. As the leading global hydrogen supplier, Air Products develops, engineers, builds, owns and operates some of the world’s largest hydrogen projects. Through its sale of equipment businesses, the Company also provides turbomachinery, membrane systems and cryogenic containers globally.

Air Products had fiscal 2025 sales of $12 billion from operations in approximately 50 countries. For more information, visit airproducts.com or follow us on LinkedInXFacebook or Instagram.

This release contains “forward-looking statements” within the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are based on management’s expectations and assumptions as of the date of this release and are not guarantees of future performance. While forward-looking statements are made in good faith and based on assumptions, expectations and projections that management believes are reasonable based on currently available information, actual performance and financial results may differ materially from projections and estimates expressed in the forward-looking statements because of many factors, including the risk factors described in our Annual Report on Form 10-K for the fiscal year ended September 30, 2025 and other factors disclosed in our filings with the Securities and Exchange Commission. Except as required by law, we disclaim any obligation or undertaking to update or revise any forward-looking statements contained herein to reflect any change in the assumptions, beliefs or expectations or any change in events, conditions or circumstances upon which any such forward-looking statements are based.

View original content to download multimedia:https://www.prnewswire.com/apac/news-releases/air-products-to-expand-integrated-gas-supply-network-for-semiconductor-manufacturer-in-taiwan-302831489.html

SOURCE Air Products and Chemicals, Inc.

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Air Products to Expand Integrated Gas Supply Network for Semiconductor Manufacturer in Taiwan

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New investment to support next-generation facility expansion

TAIPEI, July 22, 2026 /PRNewswire/ — Air Products (NYSE:APD), a world-leading industrial gases company, today announced Air Products San Fu has been awarded a long-term agreement to support a semiconductor manufacturer’s expansion in Taiwan. The project will supply multiple new semiconductor fabs and back-end packaging facilities, supporting growing demand driven by artificial intelligence and high-performance computing.

Air Products San Fu will build, own, and operate four large state-of-the-art air separation units and bulk gas supply systems with new underground pipeline systems. The company will supply a range of industrial gases, including nitrogen, oxygen, argon, and helium to support the customer’s semiconductor operations.

The new underground pipeline systems will be connected to Air Products’ existing pipeline network in Taiwan, further enhancing supply reliability, operational efficiency, and resilience.  

“Air Products is honored to be selected by our strategic customer to support their continued growth, building on our proven track record and strong long-term partnership,” said Paul Yang, President, Air Products San Fu. “This project further reinforces our role as a trusted supplier in Taiwan and reflects our long-term commitment to grow with our customers. It also underscores our world-class performance in safety, reliability and operational excellence, which are critical to meeting the increasingly demanding requirements of the electronics industry.”

Air Products has been serving the Taiwan market through Air Products San Fu for more than 70 years and has established leading supply positions across key science parks with extensive pipeline networks. The company operates one of the world’s largest ultra-high purity nitrogen pipeline systems in Southern Taiwan and is the first gas company in Taiwan awarded ISO9002 and ISO14000 certifications. 

This latest project further strengthens Air Products’ integrated supply footprint across both front-end semiconductor manufacturing and back-end advanced packaging, reinforcing its position as a key supplier to the electronics industry in Taiwan.

Air Products has served the global electronics industry for more than 40 years, supplying industrial gases safely and reliably to many of the world’s leading technology companies.

About Air Products

Air Products (NYSE: APD) is a world-leading industrial gases company in operation for over 85 years focused on serving energy, environmental, and emerging markets and generating a cleaner future. The Company supplies essential industrial gases, related equipment and applications expertise to customers in dozens of industries, including refining, chemicals, metals, electronics, manufacturing, medical and food. As the leading global hydrogen supplier, Air Products develops, engineers, builds, owns and operates some of the world’s largest hydrogen projects. Through its sale of equipment businesses, the Company also provides turbomachinery, membrane systems and cryogenic containers globally.

Air Products had fiscal 2025 sales of $12 billion from operations in approximately 50 countries. For more information, visit airproducts.com or follow us on LinkedInXFacebook or Instagram.

This release contains “forward-looking statements” within the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are based on management’s expectations and assumptions as of the date of this release and are not guarantees of future performance. While forward-looking statements are made in good faith and based on assumptions, expectations and projections that management believes are reasonable based on currently available information, actual performance and financial results may differ materially from projections and estimates expressed in the forward-looking statements because of many factors, including the risk factors described in our Annual Report on Form 10-K for the fiscal year ended September 30, 2025 and other factors disclosed in our filings with the Securities and Exchange Commission. Except as required by law, we disclaim any obligation or undertaking to update or revise any forward-looking statements contained herein to reflect any change in the assumptions, beliefs or expectations or any change in events, conditions or circumstances upon which any such forward-looking statements are based.

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SOURCE Air Products and Chemicals, Inc.

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UOB partners Visa to launch new Visa Infinite tiers across ASEAN in landmark multi-market launch of such scale

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More than 300,000 cardholders will enjoy expanded suite of premium benefits as UOB strengthens its regional leadership in premium payment solutions.

SINGAPORE, July 22, 2026 /PRNewswire/ — UOB has partnered with Visa, a global leader in digital payments, to relaunch several card products across its five key markets (Singapore, Malaysia, Thailand, Indonesia and Vietnam) under Visa’s newly introduced premium card tiers, Visa Infinite Privilege and Visa Infinite Private.

UOB is progressively upgrading its suite of affluent and high-net-worth (HNW) card solutions to the new Visa Infinite tiers, reinforcing the Bank’s leadership in premium card innovation. With the relaunch, more than 300,000 UOB Visa Infinite cardholders across ASEAN will be upgraded to higher card tiers, giving them access to an expanded suite of premium benefits. All other cardholders will continue to enjoy their existing privileges, with no downgrades across the portfolio. Eligible UOB Visa Infinite cardholders will be notified of their new card tiers via UOB’s official channels from September onwards, with no action required from them.

UOB is currently Visa’s largest card issuer in ASEAN[1] and brings an unparalleled regional footprint and customer base, serving over 8.5 million customers across the region. As the first Visa issuer across ASEAN to execute a launch of this scale across multiple markets, UOB and Visa are setting a new benchmark for regional card offerings, delivering elevated privileges and experiences to affluent cardmembers in the region. This collaboration is timely as affluent spending in ASEAN experiences strong growth. The number of new UOB affluent cardholders[2] grew over 10 per cent year-on-year in 2025, while card billings for this segment surged more than 25 per cent in the same year.

Visa unveiled its refreshed Visa Infinite offering in Asia Pacific on 16 July 2026, reimagined for the evolving needs of today’s affluent consumers. Anchored in a three-tier card suite, the enhanced platform introduces greater flexibility, personalisation and differentiated benefits across the affluent spectrum. In addition to Visa Infinite, the portfolio now includes the newly launched Visa Infinite Privilege and Visa Infinite Private, enabling issuers to deliver more tailored value propositions, experiences and rewards to distinct customer segments within a unified premium framework.

Selected top-tier UOB cardholders across the region will enjoy access to enhanced platform privileges and UOB-exclusive curated experiences, tailored to their respective Visa Infinite tiers. This aligns with UOB’s sharpened customer segmentation approach and enhanced card value propositions, aimed at serving the unique needs of customers by offering exclusive privileges tailored to their lifestyle preferences.

Mr Pratik Bhattacharjee, Head of Group Cards and Payment Products, UOB, said, “As UOB continues to sharpen our customer-centric operating model, we are focused on serving our customers more holistically across the wealth spectrum. Our partnership with Visa marks a significant milestone in this journey, allowing us to deepen our engagement with affluent customers by curating exclusive experiences that money cannot buy. As we continue strengthening our offerings to cater to each customer’s aspirations and lifestyle, our goal is to connect with them through life moments and opportunities that truly matter.”

Mr. T.R. Ramachandran, Head of Products & Solutions for Asia Pacific, Visa, said, “The affluent segment is one of the fastest-growing consumer segments in Asia Pacific, with expectations evolving alongside it. Today’s affluent consumers are seeking experiences that are more personalised, seamless and relevant to their lifestyles. The refreshed Visa Infinite portfolio is designed to meet these changing expectations, and through our partnership with UOB, we are extending these enhanced experiences to affluent customers across Southeast Asia.”

Greater personalisation through tiered privileges

With Visa’s enhanced Infinite tier segmentation, selected cardholders will benefit from more tailored services, differentiated privileges and elevated experiences that reflect their evolving lifestyle needs. This includes access to curated regional and global lifestyle offers as well as premium destination-based travel and dining privileges worldwide as part of the base membership. In addition, selected cardholders will get exclusive access to top-tier concerts and global sporting events like FIFA World Cup™, and reserved entitlements to key lifestyle offerings under Visa Infinite Privilege. At the highest tier, Visa Infinite Private offers bespoke invitation-only experiences highly personalised for ultra-high-net-worth individuals.

Leveraging its deep understanding of affluent customers across the region, UOB will complement Visa’s refreshed benefits with exclusive privileges, curated experiences and value-added offerings tailored to the unique preferences of its cardmembers. For example, selected cardholders will be able to enjoy specially-customised luxury travel experiences and privileged access to curated series of rare timepieces.

Paired with the Bank’s unparalleled regional connectivity, advisory excellence and One Bank ecosystem, this partnership with Visa aligns with UOB’s aim to bring together banking, wealth and lifestyle holistically to all customers. This also furthers the Bank’s ambition to become the Bank of Choice for aspiring customers across ASEAN.

-END-

About UOB

UOB is a leading Asian bank with a global network in Southeast Asia, Asia Pacific, Europe and North America. Operating through our head office in Singapore and banking subsidiaries in China, Indonesia, Malaysia, Thailand and Vietnam, we have a global network of more than 470 branches and offices in 19 markets. Since its incorporation in 1935, UOB has grown organically and through a series of strategic acquisitions. Today, UOB is rated among the world’s top banks: Aa1 by Moody’s Investors Service and AA- by both S&P Global Ratings and Fitch Ratings.

For more than nine decades, UOB has adopted a customer-centric approach to create long-term value by staying relevant through its enterprising spirit and doing right by its customers. UOB is focused on building the future of ASEAN – for the people and businesses within, and connecting with, ASEAN.

The Bank connects businesses to opportunities in the region with its unparalleled regional footprint and leverages data and insights to innovate and create personalised banking experiences and solutions catering to each customer’s unique needs and evolving preferences. UOB is also committed to help businesses forge a sustainable future, by fostering social inclusiveness, creating positive environmental impact and pursuing economic progress. UOB believes in being a responsible financial services provider and is steadfast in its support of art, social development of children and education, doing right by its communities and stakeholders.

About Visa

Visa (NYSE: V) is a world leader in digital payments, facilitating transactions between consumers, merchants, financial institutions and government entities across more than 200 countries and territories. Our mission is to connect the world through the most innovative, convenient, reliable and secure payments network, enabling individuals, businesses and economies to thrive. We believe that economies that include everyone everywhere, uplift everyone everywhere and see access as foundational to the future of money movement. Learn more at www.visa.com.sg 

[1] Largest card issuer by total billings

[2] Includes UOB Reserve Card, UOB Zenith Card and UOB Visa Infinite cards

 

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SOURCE UOB

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