Q4 2024 Dye & Durham Ltd Earnings Call

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[music].

Operator: Welcome to your conference call. Please continue to stand by your conference; we'll begin shortly.

Speaker Change: Welcome to the conference call. Please could eat the Sun by your conference will begin shortly.

Speaker Change: [music].

Operator: Good afternoon.

<unk>: Good afternoon, My name is <unk> and I'll be a conference operator today at this time I would like to welcome everyone to the diet and they're having a fourth quarter and year end fiscal 2024 earnings call.

Inna: My name is Inna, and I will be your conference operator today. At this time, I would like to welcome everyone to the Dye & Durham Fort Quarter and your end fiscal to 2024 earnings call.

Inna: I would like to turn a call over to Ross Hirji, VP Investor Relations of Dye & Durham.

Mr. Hickey: I would now like to turn the call over to your house Fuji VP Investor Relations of diet under him. Mr. Hickey you may begin your conference.

Ross Hirji: Mr. Hirji, you may begin your conference. Great, thank you, operator, and good afternoon, everyone. Welcome to the Dye & Durham conference call.

Mr. Hickey: Great. Thank you operator, and good afternoon, everyone.

Speaker Change: Welcome to the Dime Derm conference call.

Ross Hirji: Before we start, we'd like to remind you that all amounts discussed on this call are denominated in Canadian dollars, unless otherwise indicated. Please note that statements majoring this call may include forward looking statements and information and future of the financial information regarding Dye & Durham and its businesses and disclosure regarding possible events, conditions or results that are based on information currently available to management, which indicate management's expectation of future growth, results of operations, business performance and business prospects and opportunities. Such statements are made as of this day, hereof, and Dye & Durham assumes no obligation to update or revise them to reflect events, disclosures, or circumstances, except as required by applicable securities laws.

Speaker Change: Before we start we'd like to remind you that all amounts discussed on this call are denominated in Canadian dollars unless otherwise indicated.

Speaker Change: Please note that statements made during this call may include forward looking statements and information and future financial information regarding <unk> and its businesses and disclosure regarding possible events conditions or results that are based on information currently available to management, which indicate man.

Speaker Change: Rents expectation of future growth results of operations business performance and business prospects and opportunities.

Speaker Change: Such statements are made as of this date hereof, and Don Durham assumes no obligation to update or revise them to reflect events disclosures or circumstances, except as required by applicable securities laws.

Ross Hirji: Such statements involve significant risks and uncertainties and are not a guarantee of future performance or results. A number of these risks or uncertainties could cause results to differ materially from the results discussed today. Given these risks and uncertainties, one should not place undue reliance on these statements and information. Please refer to the forward-looking statements in the information and future-oriented financial information section of our public violence, without limitation, our MDNA and our earnings press release issued today for additional information.

Speaker Change: Such statements involve significant risks and uncertainties and are not a guarantee of future performance or results.

Number of these risks or uncertainties could cause results to differ materially from the results discussed today.

Speaker Change: Given these risks and uncertainties, one should not place undue reliance on these statements and information.

Speaker Change: Please refer to the forward looking statements and information and future oriented financial information section of our public filings without limitation, our MD&A and our earnings press release issued today for additional information.

Ross Hirji: Joining us on the call today are Matt Proud, Dye & Durham Chief Executive Officer, Frank Deweyso, Dye & Durham Chief Financial Officer, and Martha Valeds, Global Chief Operating Officer.

Speaker Change: Joining us on the call today are Matt crowd, Diane Durham, Chief Executive Officer, Frank do we so Dion Durham, Chief Financial Officer, and Martha valid as global Chief operating Officer.

Ross Hirji: A question and answer session will follow the formal remarks for research analysts.

Speaker Change: And answer session will follow the formal remarks for research analysts and I'll turn the call over to Matt for opening remarks.

Ross Hirji: An answer to the call over to Matt for opening.

Matthew Proud: Thanks us and good afternoon everyone. We've built one of the largest legal technology software companies in the world. Our customers depend on our products daily as mission-critical software to manage their business effectively and efficiently. This represents 15% growth. We also generated the second highest level of adjusted EBITDA, taking into consideration the TM Group devestiture with 69 million in the fourth quarter. While both revenue growth and EBIT are important, we remain focused on generating free cash flow after servicing all the company's obligations. In this regard, I'm very pleased to announce in the quarter that we generated approximately 32 million of leverage-free cash flow, a record quarter performance since the company's IPO four years ago.

Matt: Thanks, Josh and good afternoon, everyone.

Matt: We built one of the largest legal technology software companies in the world.

Matt: Our customers depend on our products daily as mission critical software to manage their business effectively and efficiently.

Speaker Change: You can see the momentum we're building with our fourth quarter results, we reported the highest revenue quarter in our company's history, excluding the impact of the T. M group divestiture with a $120 million of topline revenue this represents 15% growth.

Speaker Change: We also generated the second highest level of adjusted EBITDA, taking into consideration the T. M group divestiture with 69 million in the fourth quarter.

Speaker Change: Well, both revenue growth and EBIT are important we remain focused on generating free cash flow.

Speaker Change: If you're servicing all the company's obligations.

Speaker Change: This regard I'm very pleased to announce in the quarter that we generated approximately $32 million of leveraged free cash flow a record quarter performance since the company's IPO four years ago.

Matthew Proud: At Dye & Durham, we are very fortunate to be servicing the very attractive legal services at market, which has an accelerated adoption of technology to improve efficiencies in their client experience. This means that the business will well-positioned across our tens of thousands of customers who are looking for streamlined workflows delivered through central dashboards with single sign-on and software interoperability. We've invested significant sums of money over the last couple of fiscal years to make this a reality for our customers.

Speaker Change: At Dine, Jeremy we are very fortunate to be servicing the very attractive legal services end market, which has an exam or accelerated adoption of technology to improve efficiencies and their client experience.

Speaker Change: This means that the business, we're well positioned across our tens of thousands of customers who are looking for streamlined workflows delivered through central dashboards with single sign on and software entry of Operability we.

Speaker Change: We've invested significant sums of money over the last couple of fiscal years to make this a reality for our customers.

Matthew Proud: As you can see from the results, let's now pay off. Virtually all of our customers across the small and medium law segment, which we focus on, require mission-critical legal practice and software to run their practice. Equally as important, this same segment requires non-discretionary data and insight applications to conduct legal due diligence and the associated regulatory filings on behalf of their clients. Our strategy is to win by providing the interoperability to our customers at this intersection. Our financial technology business provides banking software to more than 100 financial institutions across Canada and Australia, including leading technology, payments, and banking services, to name a few.

Speaker Change: As you can see from the results with Fidel paying off.

Virtually all of our customers across the small and medium loss segment, where he focused on require a mission critical legal practice management software to run their practice.

Speaker Change: Equally as important this same segment requires non discretionary data and insight applications to conduct legal due diligence and the associated regulatory filings on behalf of their clients.

Speaker Change: Our strategy is to win by providing interim ability to our customers at this intersection.

Speaker Change: Our financial Technology business provides banking software to more than 100 financial institutions across Canada, and Australia, including leading technology payments manage banking services to name a few.

Matthew Proud: Across our platform, our customers and their end customers rely on our solutions every day to complete transactions and move funds. This business is performing well and grew year over year and has produced revenue growth greater of 20% in fiscal 24. And in the start of fiscal 25, it's off to an even greater start.

Across our platform our customers and their end customers rely on our solutions every day.

Speaker Change: <unk> transactions and move funds. This pause is performing well and grew year over year and has produced revenue growth greater than 20% in fiscal 'twenty four and at the start of a crystal twenty-five it's off to an even greater start.

Matthew Proud: As you know, there's an ongoing strategic review of this business, which has been challenging to manage given the distraction of recent activist activities that's been reported on. We continue to focus on our go-to-market strategy. As you can see, over the last two fiscal years, we managed to build our ARR to $137 million, a number which is rapidly growing. When we think of go-to-market dinderm, the strategy falls into two buckets. One, continue to focus on our top couple of thousands of clients and put them into minimum spend contracts. And two, start to focus more on our large tail, tens of thousands of customers, and drive a larger subscription-based revenue model business.

Speaker Change: As you know there is an ongoing strategic review of this business, which has been challenging to manage given the distraction of recent activist activity just reported on.

Speaker Change: We continue to focus on our go to market strategy as you can see over the last two fiscal years, we managed to build our <unk> to $137 million.

Speaker Change: Which is rapidly growing.

Speaker Change: When we think of go to market either the strategy falls into two buckets.

Speaker Change: One continue to focus on our top couple of thousand clients and putting them into minimum spend contracts and to start to focus more on our large tail of tens of thousands of customers and drive.

Speaker Change: Larger subscription based revenue model business.

Matthew Proud: We have approximately $70 million dollars of license-based description we have given you today, and our recent investments are designed to involve our offering into a more modern, modern SaaS-based relationship by providing a whole suite of products to a law firm that they require to run their practice together with a single technology platform instead of the more legacy common market practice of a single-point solution product offering. These points solutions are disjointed and require law firms to utilize multiple systems, which create complexity and a total act of efficiency. We see an ability in the future years to significantly grow this subscription-based model, while continue to transition our larger customers that couple thousand I talked of to minimum spend contracts.

We have approximately $70 million of licensed based subscription revenue today and our recent investments are designed to evolve our offering into a more modern modern SaaS based relationship by providing a whole suite of products to a law firm, but they require to run their practice together with a single technology platform instead of the more legacy.

Speaker Change: Common market practice of a single point solution product offering.

Speaker Change: These point solutions are disjointed and require law firms to utilize multiple systems, which create complexity and a total lack of efficiency.

Speaker Change: We see an ability in the future years to significantly grow this subscription based model while continued transition of our larger customers. A couple of thousand I talked of de Minimis spend contracts. This will help us grow our air or even further.

Matthew Proud: This will help us grow our area even further. Our strategy at Dye & Durham is to create the interoperability and bridge requirements for law firms to use multiple systems in a day-to-day workflow. As you know, we've acquired a large number of practice management and data insight into Dylan's applications globally, and have worked very hard to integrate and create a consolidated platform and common brand for our customers around the world. This puts us in a great position to capture market share in this highly fragmented market that is forecasted to double by 2030. Our Unity Global Platform is core to this strategy, with the practice management and data insights into Dylan's verticals.

Speaker Change: Our strategy of Dorian Durham is to create the interoperability and bridge the requirements for law firms to use multiple systems in their day to day workflow.

Speaker Change: As you know we've acquired a large number of practice management and data insight into dealers applications globally and have worked very hard to integrate and create a consolidated platform and common brand for our customers around the world.

Speaker Change: This puts us in a great position to capture market share in this highly fragmented market that is forecasted to double by 2030.

Our unique global platform is core to the strategy with the practice management and data insights into gilligan's verticals.

Matthew Proud: Unity brings together all the tools a small or medium-sized business, a small or medium-sized law firm requires to run their practice, save their customers time and money, and providing real operational cost efficiencies as well as the latest technology. In addition to ARR growth, we also have a number of customers like financial institutions that generate revenue from us from contract overages and other revenue contracts through service agreements together with the ARR. This annual contracted revenue represents 51% of the total revenue for the fourth quarter. We believe multiple levers exist to continue driving value creation at Dianner.

Speaker Change: He already brings together all the tools of small or medium sized business.

Speaker Change: So medium to small and midsized law firm requires to run their practice saving our customers time and money and providing real operational cost efficiencies as well as the latest technologies in the market, including our reliance on AI.

Speaker Change: Okay.

Speaker Change: In addition to our growth. We also have a number of customers like financial institutions that generate revenue from us from contract Overages and other revenue contracts with service agreements together with this annual contracted revenue represents 51% of the total revenue in the fourth quarter.

Okay.

Speaker Change: We believe multiple levers exists to continue driving value creation Diane Durham.

Matthew Proud: On the transactional side of the business, the interest rate environment supports the normalization of market activity in real estate and M&A. These are just two of the few drivers that are macro drivers in our transactional business. More transactions across our customer base generate more fees. Given our scale, this incremental revenue has an outside impact on our bottom line. It is little to no incremental cost to additional transactions. We also can optimize the market position and positioning of our pricing and transaction offering. As we develop new functionalities and enhance and expand our application set, we are allowing our pricing strategy with the value we deliver to our customers.

Speaker Change: On the transactional side of the business the interest rate environment supports the normalization of market activity in real estate and M&A.

Diane Durham: Two a few drivers that are macro drivers in our transactional business.

Speaker Change: More transactions across our customer base and generates more fees given our scale. This incremental revenue has an outsized impact on our bottom line is there is little to no incremental cost to additional transactions.

Speaker Change: We also can you optimize the market position and positioning of our of our pricing and transaction offerings.

Speaker Change: As we develop new functionalities and enhance and expand our application set we are aligning our pricing strategy with the value we deliver to our customers.

Matthew Proud: Edged the evidence by our results are strategies working. Organic growth rate came in at 8% during the fourth quarter. A number we're very proud of. Our market positioning and the green shoot in the macro market activity are bolstering our growth.

Speaker Change: As evidenced by our results.

Speaker Change: Our strategy is working.

Speaker Change: Organic growth rate came in at 8% during the fourth quarter a number we're very proud of.

Speaker Change: Our market positioning and the green shoot in the macro market activity are bolstering our growth. This resulted.

Matthew Proud: This resulted. This result, all piece the growth contributed from acquisitions in the quarter. On acquisitions, acquisitions still remain part of our strategy. We will continue to focus on driving; however, we will continue to focus on driving organic growth, and when it comes to acquisitions, doing more smaller tuck-in. This will allow us to focus on reducing our leverage ratio. That said, we remain very committed to driving leverage below four times as quickly as possible. At the same time, we have successfully demonstrated our ability to make acquisitions and deliver revenue synergies by cross-selling to our large customer base in optimizing our pricing strategy of the unmanaged assets in the market.

Speaker Change: This result, Lp's the growth contributed from acquisitions in the quarter.

Speaker Change: Yeah.

Speaker Change: On acquisitions acquisition is still to remain part of our strategy will continue and will continue to focus on driving however, we will continue to focus on driving organic growth and when it comes to acquisitions doing more smaller tuck in M&A.

Speaker Change: This will allow us to focus on reducing our leverage ratio.

Speaker Change: That said, we remain very committed to driving leverage below four times as quickly as possible.

Speaker Change: At the same time.

Speaker Change: <unk> successfully demonstrated our ability to make acquisitions to deliver revenue synergies by cross selling our alert to a large customer base and optimizing our pricing strategy of the unmanaged assets in the market in addition to reducing operator.

Matthew Proud: In addition to reducing operational costs, we intend to remain disciplined. To that end, subsequent to June 30th, we've expanded our practice-managed offering across the Asia-Pacific region, the strategic tuck-in of Lexus Affinity in the Asia-Pacific region. This acquisition is aligned with our existing offering and complement our strategic vision of growing air through our practice management offering and owning that intersection of data and PMS software. The business and headquarter in Sydney, Australia, has approximately 60 employees across the APEC region, including Australia and New Zealand. The Affinity Flagship Paxman Software Service has approximately 12,000 users in medium-sized law firms across the region.

Speaker Change: Operational costs, we intend to remain disciplined.

Speaker Change: To that end subsequent to June 30, we expanded our practice managed offering across the Asia Pacific region, the strategic tuck in of Lexis affinity in the Asia Pacific region.

Speaker Change: This acquisition is aligned with our existing offering and complements our strategic vision of growing air through our practice management.

Speaker Change: Offering and owning the intersection of data and PFS software.

Speaker Change: The business is headquartered in Sydney, Australia, and has approximately 60 employees across the APAC region, including Australia.

Speaker Change: New Zealand.

Speaker Change: <unk> flagship <unk> software services, approximately 12000 units users in medium sized law firms across the region.

Matthew Proud: The upfront cost for Affinity, the upfront consideration for Lexus Affinity plus another small tuck-in acquisition was $21 million subsequent to June 30th. We were able to negotiate very favorable payment terms on both these acquisitions, meaning the remaining deferred consideration to over 48 million will be payable interest-free over a multi-year period, and the company estimates a large portion we paid for as of the free cash flow generated from these businesses.

Speaker Change: Yeah.

Speaker Change: The upfront cost for affinity.

Speaker Change: The upfront the upfront consideration for Lexis Nexis affinity plus another small tuck in acquisition was $21 million subsequent to June 30.

Speaker Change: We were able to negotiate very favorable payment terms on both of these acquisitions, meaning the remaining deferred consideration totaling $48 million will be payable interest free over a multiyear period and the company estimates a large portion we paid for under the free cash flow generated from these businesses.

Martha Vallance: I'm now going to turn over to Martha to speak about a strong track record of capital allocation and acquisition results.

Speaker Change: I'm now going to turn over to Marcia to speak about our strong track record of capital allocation and acquisition results.

Martha Vallance: Thank you and good afternoon, everyone. As Matt mentioned, since the IPO, we have implemented a disciplined acquisition strategy that has significantly scaled the business by deploying approximately 1.9 billion in capital. On slide 17, you can see the impact of these acquisitions. This group of acquired businesses accounts for more than three quarters of the capital that we've deployed in our acquisition strategy. The performance speaks for itself. Across these acquisitions, we've consistently delivered double-digit compound annual revenue growth. Our largest acquisition due process, we have nearly tripled revenue since we acquired that business in late 2020. More recently, we acquired CRETA, which provides KYC and AML capabilities used by lawyers to verify their customers' identity in the UK.

Marcia: Thank you and good afternoon, everyone.

Marcia: Matt mentioned since the IPO, we have implemented a disciplined acquisition strategy that is significantly scaled the beds by deploying approximately one 9 billion.

Marcia: On Slide 17, you can see the impact of these acquisitions.

Speaker Change: <unk> group acquired businesses account for more than three quarters of the capital that we've deployed in our acquisition strategy.

Speaker Change: Performance speaks for itself across these acquisitions, we've consistently delivered double digit compound annual revenue growth.

Speaker Change: Largest acquisition due process, we have nearly tripled revenue since we acquired that business in late 2020.

Speaker Change: More recently, we acquired <unk>, which provides cable IC in AML capability is used by Larry to verify their customers' identity in the UK.

Martha Vallance: This is a critical part of the customer onboarding process for lawyers, and a white-labeled version of the CRETA's technology is already now integrated with our products management applications in the UK, allowing our customers direct access to use this technology. Despite having known this business for less than a year, the revenue of CRETA is up over 30% since we closed the acquisition, and we expect strong performance to continue as we drive further adoption of this product amongst our CRETA customers. Our acquisition strategy has been centered around building a platform of scale and bringing together mission-critical technologies used in the legal and financial sector.

Speaker Change: This is a critical part of the customer on boarding process for lawyers and a white labeled version of accretive technology. It's already now integrated with our practice management applications in the U K, allowing our customers direct access to use this technology.

Speaker Change: Having known this business for less than a year. The revenue accretive is up over 30% and since we closed the acquisition and we expect strong performance to continue as we drive further adoption of this product amongst our U K customers.

Speaker Change: Our acquisition strategy has been centered around building a platform at scale and bringing together mission critical technologies used in the legal and financial sector.

Martha Vallance: We have been able to drive outsize returns for many of these acquisitions because they fit strategically into the business and the platform that we are building. Well, this slide looks at the performance on a case-by-case basis, pulling back to our full-sale view on the next slide. You can see the overall impact. We reported approximately 40 million of adjusted EBITDA at the time of our ideas. We've acquired 113 million in evida since that time at a cost of 16.6 times evida. We've created significant value from those acquisitions, with 103 million organic adjusted revenue growth off of our pre-IPO and acquired evida base.

Speaker Change: We have been able to drive outsized returns for many of these acquisition because they fit strategically into the business.

Speaker Change: We are building.

Speaker Change: Well, that's fine, but the performance on a case by case basis pulling back Jabara wholesale deal in the next slide you can see the overall impact.

Speaker Change: We reported approximately $40 million of adjusted EBITDA at the time of our IPO.

Speaker Change: We've acquired 113 million in EBITDA since that time, the Rx box at 16.

Speaker Change: EBITDA.

Speaker Change: Created significant value from those acquisitions under $83 million of organic adjusted revenue growth off of our pre IPO and acquired EBITDA base.

Operator: Welcome to your conference call. Please continue to stand by your conference, we'll begin shortly.

Martha Vallance: Our ability post-acquisition to repeatedly drive financial upside and extract incremental value from these businesses has meant that our post-energy evida acquisition multiple is now down to 8.75. We will remain disciplined with our acquisition strategy.

Speaker Change: Our ability post acquisition to repeatedly drive financial upside and extract incremental value from these businesses has meant that our post synergy EBITDA acquisition multiple is now down to eight seven times.

Speaker Change: We will remain disciplined with our acquisition strategy.

Martha Vallance: We will deploy capital carefully on strategic tech and acquisitions where we are confident that we can repeat our track record of driving strong post-acquisition performance, and we will do this in parallel with our debt repayment targets.

Speaker Change: Deploy capital carefully on strategic tuck in acquisitions, where we are confident that we can repeat our track record of driving strong post acquisition performance and we will do this in parallel with our debt repayment target.

Frank Liso: I'll now turn it over to Frank to discuss the financials.

Speaker Change: I'll now turn it over to Frank to dusk to discuss the financials.

Frank Liso: Thank you, Martha, and good afternoon, everyone. This afternoon, we reported a fourth quarter in year-end fiscal 2024 results. Our results continue to demonstrate resiliency and diversification of the business, support and growth in our practice management offerings, and our annual current revenue continues to grow, which reduces the reliance on real estate transactions. Our annual contracted revenue remains robust, driven by both our practice management and our payments infrastructure service lines. Revenue exposed to real estate transactions globally in Q4 was 50% compared to 58% in the same period of fiscal 2023. It's important to keep in mind that fiscal 24 is the strongest seasonal period for real estate transactions.

Frank: Thank you Marissa and good afternoon, everyone. This afternoon, we reported our fourth quarter and year end fiscal 2024 results.

Frank: Our results continue to demonstrate the resiliency and diversification of the business to support growth in our progress management offerings.

Frank: And our annual <unk> revenue continues to grow which reduces the reliance on real estate transactions.

Our annual contracted revenue remains robust driven by both our practice management and our payments infrastructure service lines.

Frank: When you expose to real estate transactions globally in Q4 was 50% compared to 58% in the same period of fiscal 2023.

Inna: Good afternoon. My name is Inna and I will be your conference operator today. At this time, I would like to welcome everyone to the Dye & Durham Fort Quarter and your end fiscal to 2024 earnings call.

Frank: It's important to keep in mind that fiscal 'twenty four is our strongest seasonal period for real estate transactions.

Inna: I would like to turn a call over to Ross Hirji, VP Investor Relations of Dye & Durham. Mr. Hirji, you may begin your conference.

Frank Liso: Revenue exposed to real estate transactions in Canada was only 28% compared to 33% in the same period of last year. Our actual exposure to real estate transactions is even lower than 28% as the Canadian figures include refinancing transactions. Annual recurring contracted revenue was 29% as of June 30th, compared to 18% at the same point in the prior year. As Matt mentioned, there are components of our revenue, which we do not include in ARR, such as revenue from contracted overdues and other revenues under contract with service arrangements. These are included in annual contracted revenue, which includes AR and was 51% in the fourth quarter compared to 39% in the prior year period.

Revenue exposed to real estate transactions in Canada was only 28% compared to 33% in the same period of last year.

Ross Hirji: Great, thank you operator and good afternoon everyone. Welcome to the Dye & Durham Conference call. Before we start, we'd like to remind you that all amounts discussed on his call are denominated in Canadian dollars, unless otherwise indicated. Please note that statements majoring this call may include forward looking statements and information and future of the financial information regarding Dye & Durham and its businesses and disclosure regarding possible events, conditions or results that are based on information currently available to management, which indicate management's expectation of future growth, results of operations, business performance and business prospects and opportunities.

Frank: Our actual exposure to real estate transaction is even lower than 20% at the Canadian figures include refinancing transactions.

Frank: Annual recurring contracted revenue was 29% as of June 30, compared to 18% at the same point in the prior year.

Frank: As Matt mentioned, there are components of our revenue, which we do not include in <unk>, such as revenue from contracted Overages and other revenues under contract with service arrangements.

Matt: These are included in annual contracted revenue, which includes <unk> and was 51% in the fourth quarter compared to 39% in the prior year period.

Frank Liso: We reported revenues of 120 million and 458 million in the fourth quarter and fiscal year 2024, respectively. This represents growth of 15 and 14% respectively compared to the corresponding periods in fiscal 23 when taken into consideration the sale of TM in August of 2023. Revenue was unchanged in two four year over year and grew 1.5% in fiscal 2024, including the impact of TMG in the prior period, mainly as a result of organic initiatives. We generated ajustity of 69 million and 258 million in the fourth quarter and fiscal 2024 periods, respectively. The growth of 5 and 6% in their respective periods was despite the divestiture of TM and its contribution in the prior period.

We reported revenues of $120 million and $458 million in the fourth quarter and fiscal year 2024, respectively.

Ross Hirji: Such statements are made as of this day here of and Dye & Durham assumes no obligation to update or revise them to reflect events, disclosures or circumstances, except as required by applicable securities laws. Such statements involve significant risks and uncertainties and are not a guarantee of future performance or results. A number of these risks or uncertainties could cause results differ materially from the results discussed today. Given these risks and uncertainties, one should not place undue reliance on these statements and information.

This represents growth of 15% and 14% respectively compared to the corresponding periods periods in fiscal 2003 when taken into consideration the sales team in August of 2023.

Speaker Change: Revenue was unchanged in Q4 year over year and grew one 5% in fiscal 2024, including the impact of Gmg in the prior period, mainly as a result of organic initiatives.

Speaker Change: We generated adjusted EBITDA of $69 million and $258 million in the fourth quarter and fiscal 2024 periods respectively.

Ross Hirji: Please refer to the forward looking statements in information and future oriented financial information section of our public violence with out limitation, our MDNA and our earnings press release issue today for additional information.

Speaker Change: The growth of five 6% in the respective periods was despite the divestiture of TM and its contribution in the prior periods.

Frank Liso: The improvements were primarily related to the growth and organic initiatives, as well as the impact of our business improvement plan and lower direct cost. We continue to maintain our strong beta margins, coming in at 57% in the quarter and 56% for the fiscal year, which is in line with our target range between 50% and 60%. We continue to maintain 200 million for the quarter and fiscal year periods, respectively, or 43% and 44% of revenue. Adjusted operating expenses for the quarter and fiscal year were lower by approximately 3.4% and 7.3 million, respectively, from the prior periods, which demonstrates the improvements from our business improvement plan.

Ross Hirji: Joining us on the call today are Matt Proud, Dye & Durham Chief Executive Officer, Frank Deweyso, Dye & Durham Chief Financial Officer, and Martha Valeds Global Chief Operating Officer. A question and answer session will follow the formal remarks for research analysts. An answer to the call over to Matt for opening.

Speaker Change: The improvements were primarily related to growth and organic initiatives as well as the impact of our business improvement plan and lower direct costs. We continue.

Speaker Change: To maintain our strong EBITDA margins coming in at 57% in the quarter and 56% for the fiscal year, which is in line with our target range between 50% and 60%.

Speaker Change: Total adjusted operating expenses, which include direct costs technology costs, G&A sales and marketing.

Matt Proud: Thanks us and good afternoon everyone. We've built one of the largest legal technology software companies in the world. Our customers depend on our products daily as mission critical software to manage their business effectively and efficiently. This represents 15% growth. We also generated the second highest level of adjusted EBITDA, taking into consideration the TM Group Devastiture with 69 million in the fourth quarter. While both revenue growth and EBIT are important, we remain focused on generating free cash flow after servicing all the company's obligations.

Speaker Change: Our $51 million and 200 million for the quarter and fiscal year periods, respectively, or 43% 44% of revenue.

Speaker Change: Adjusted operating expenses for the quarter and fiscal year were lower by approximately three 4% and $7 $3 million, respectively from the prior periods, which demonstrates the improvements from our business improvement plan.

Frank Liso: Net finance costs for the quarter were 114 million and 228 million for the fourth quarter and fiscal year periods, respectively, compared to 37 million and 132 million in the corresponding periods of fiscal 23. The changing Q4 was primarily due to non-cash impacts arising from changes in the fair value of our control ventures, contingent considerations, frost currency swaps, and a loss of settlement on our retired areas facility. Adjusted finance costs was the just for these changes in fair value and settlement losses was 31.4 million, lower by 4 million versus the prior Q4 period, which primarily reflects the savings from our refinancing transaction completed in April of 2024.

Speaker Change: Net finance costs for the quarter were $114 million and $228 million for the fourth quarter and fiscal year periods, respectively, compared to $37 million and $132 million in the corresponding periods of fiscal 'twenty three.

Speaker Change: The change in Q4 was primarily due to noncash impacts arising from changes in the fair value of our convertible debentures contingent considerations cross currency swaps and a loss of settlement on a retired Ares facility.

Matt Proud: In this regard, I'm very pleased to announce in the quarter that we generated approximately 32 million of leverage free cash flow, a record quarter performance since the company's IPO four years ago. At Dye & Durham, we are very fortunate to be servicing the very attractive legal services at market, which has an accelerated adoption of technology to improve efficiencies in their client experience. This means that the business will well-positioned across our tens of thousands of customers who are looking for streamlined workflows delivered through central dashboards with single sign-on and software interoperability.

Speaker Change: Adjusted Finance costs was adjust for these changes in fair value and settlement losses was $31 4 million lowered by $4 million versus the prior Q4 period, which primarily reflects the savings from our refinancing transaction completed in April of 2024.

Frank Liso: Acquisition restructuring and other costs were 9 million and 29 million for the fourth quarter and fiscal 24 periods compared to 9 million and 59 million, respectively, in the prior period. The quarterly period was in line with the previous year. You can see the significant improvement we've made in the annual period, a 52% reduction compared to Fiscal 2023. We believe we can deliver additional improvements in this cost over time as we take additional actions to increase our cash flow performance. The gains made from our business improvement plan earlier in the year support a significant free cash flow in the quarter.

Speaker Change: Acquisition restructuring and other costs were $9 million and $29 million for the fourth quarter and fiscal 'twenty, four periods compared to $9 million and $59 million respectively in the prior period the.

Matt Proud: We've invested significant sums of money over the last couple of fiscal years to make this a reality for our customers. As you can see from the results, let's now pay off. Virtually all of our customers across the small and medium law segment, which we focus on, require mission critical legal practice and software to run their practice. Equally as important, this same segment requires non-discretionary data and insight applications to conduct legal due diligence and the associated regulatory filings on behalf of their clients.

Speaker Change: Quarterly period was in line with the previous year, you can see the significant improvement we've made in the annual period, a 52% reduction compared to fiscal 2023.

Speaker Change: We believe we can deliver additional improvements in its cost over time as we take additional actions to increase our cash flow performance.

Speaker Change: The gains made from our business improvement plan earlier in the year.

Speaker Change: Supported significant free cash flow in the quarter, we have fully realized the $70 million targeted free cash flow benefit from that plan in Q4 relative to the baseline period of fiscal.

Frank Liso: We have fully realized 70 million targeted free cash flow benefit from that plan in Q4 relative to the baseline period of fiscal Q1. We have introduced a new non-gath keep performance measure, which will continue to report on leverage free cash flow. Leverage free cash flow was 32 million in the fourth quarter. That is an improvement of 38 million compared to when we initiated the business improvement plan in the first quarter of fiscal 21. Even when taking into consideration the secured secure no interest impact, which is paid semi-annually, it is still a 24 million positive improvement or approximately 96 million annualized.

Matt Proud: Our strategy is to win by providing the interoperability to our customers at this intersection. Our financial technology business provides banking software to more than 100 financial institutions across Canada and Australia, including leading technology, payments, and banking services to name a few. Across our platform, our customers and their end customers rely on our solutions every day to complete transactions and move funds. This business is performing well and grew year over year and has produced revenue growth greater of 20% in fiscal 24.

Speaker Change: Q1.

Speaker Change: We've introduced a new non-GAAP key performance measure, which will continue to report on leveraged free cash flow.

Speaker Change: Average free cash flow was $32 million in the fourth quarter that is an improvement of $38 million compared to when we initiated the business improvement plan in the first quarter of fiscal 'twenty one.

Speaker Change: Even when taking into consideration the secured secured note interest impact which is paid semi annually. It is still a $24 million positive improvement or approximately $96 million annualized.

Frank Liso: This improvement includes savings achieved in a reduction of capital expenditures, lower net interest costs, lower adjusted operating expenses, as well as lower cash taxes paid. The cost reduction plan arising from our refinancing transaction did result in a higher amount of severance costs in the fourth quarter, and we expect to continue into the first quarter of fiscal 25. Due to the realization of synergies, which will have a benefit impact for the remainder of 2025 and beyond. As part of our emergency transaction, we've also implemented new cross currency swaps, which effectively hedge 100% of the cash for exchange movements and 85% of the interest rate movements.

Matt Proud: And in the start of fiscal 25, it's off to an even greater start. As you know, there's an ongoing strategic review of this business, which has been challenging to manage given the distraction of recent activist activities that's been reported on. We continue to focus on our go-to-market strategy. As you can see, over the last two fiscal years, we managed to build our ARR to $137 million, a number which is rapidly growing.

Speaker Change: This improvement includes savings achieved in a reduction of capital expenditures lower net interest costs lower adjusted operating expenses as well as lower cash taxes paid.

Speaker Change: The cost reduction plan to rising from our refinancing transaction did result in a higher amount of severance costs in the fourth quarter and we expect them to continue into the first quarter of fiscal 'twenty five.

Speaker Change: Due to the realization of synergies, which will have a benefit impact for the remainder of 2025 and beyond.

Matt Proud: When we think of go-to-market dinderm, the strategy falls into two buckets. One, continue to focus on our top couple of thousands of clients and put them into minimum spend contracts. And two, start to focus more on our large tail, tens of thousands of customers, and drive a larger subscription based revenue model business. We have approximately $70 million dollars of license-based description we have given you today, and our recent investments are designed to involve our offering into a more modern, modern SaaS-based relationship by providing a whole suite of products to a law firm that they require to run their practice together with a single technology platform instead of the more legacy common market practice of a single-point solution product offering.

Speaker Change: As part of a refinancing transaction. We've also implemented new cross currency swaps, which are effectively hedged 100% of the cash foreign exchange movements and 85% of the interest rate movements. These swaps will have mark to market noncash adjustments, which will result in period to period variability in our finance metric you will see this in the fourth.

Frank Liso: These swaps will have market market non-catch adjustments, which will result in period of period variability in our finance ventric. You will see this in the fourth quarter, the $20 million expense toward finance costs. Now, turning to our balance sheet, our net debt stood at approximately 1.26 billion as of June 30th, 2024, which has been reduced by approximately 36 million since June 30th of 2023. As we discussed in the last fall, we repaid all of our amounts outstanding under the Air Risk Credit Facility, with the proceeds from the Refinancing Transaction. The Refinancing Transaction in Canadian dollars consisted of approximately $254 million of senior secured notes due in 2029 and approximately $476 million in senior secured term loan B facility due in 2031 and $105 million revolving threat of facility.

Speaker Change: <unk>.

Speaker Change: $20 million expense toward finance thoughts.

Speaker Change: Now turning to our balance sheet, our net debt stood at approximately $1 $2 6 billion as of June 32024, which has been reduced by approximately $36 million since June 30 of 2023.

Speaker Change: As we discussed on the last call, we repaid all of our amounts outstanding under the Ares credit facility with the proceeds from the refinancing transaction.

Matt Proud: These points solutions are disjointed and require law firms to utilize multiple systems, which create complexity and a total act of efficiency. We see an ability in the future years to significantly grow this subscription-based model, while continue to transition our larger customers that couple thousand I talked of to minimum spend contracts. This will help us grow our area even further. Our strategy at Dye & Durham is to create the interoperability and bridge requirements for law firms to use multiple systems in a day-to-day workflow.

The refinancing transaction and Canadian dollars consider approximately $254 million of senior secured notes due in 2029 and approximately $476 million in senior secured term loan b facility due in 2031 and $105 million revolving credit facility.

Frank Liso: We understand the importance of reducing our leverage, and we've set a target to reduce it below four times total net debt to adjust the EBITDA. That said, we have sufficient resources to manage our debt levels.

Speaker Change: We understand the importance of reducing our leverage and we have set a target to reduce it below four times total net debt to adjusted EBITDA.

Speaker Change: That said, we have sufficient resources to manage our debt levels the business generates strong sustainable cash flows.

Matt Proud: As you know, we've acquired a large number of practice management and data insight into Dylan's applications globally, and have worked very hard to integrate and create a consolidated platform and common brand for our customers around the world. This puts us in a great position to capture market share in this highly fragmented market that is forecasted to double by 2030. Our Unity Global Platform is core to this strategy with the practice management and data insights into Dylan's verticals.

Frank Liso: The business generates strong, sustainable cash flows.

Operator: With that, I'll turn it back to the operator for the Q&A. Thank you, ladies and gentlemen. We will now begin the question analysis session. Should you have a question, please by starfall by the one on your telephone keypad? Should you wish to cancel the request, please by starfall by the two? If you're using your speaker phone, please lift the handset before pressing any keys. One moment, please, for your first question.

Speaker Change: With that I'll turn it back to the operator for the Q&A.

Speaker Change: Thank you ladies and gentlemen, we will now begin the question and answer session.

Speaker Change: Do you have a question. Please press star followed by the one on your telephone keypad.

Speaker Change: Should you wish to cancel your request. Please press star followed by that too.

Speaker Change: If you're using a speaker phone please lift the handset before pressing any keys one moment. Please for your first question.

Matt Proud: Unity brings together all the tools, a small or medium-sized business, a small or medium-sized law firm requires to run their practice, save their customers time and money, and providing real operational cost efficiencies as well as the latest technology. In addition to ARR growth, we also have a number of customers like financial institutions that generate revenue from us from contract overages and other revenue contracts through service agreements together with the ARR. This annual contracted revenue represents 51% of the total revenue for the fourth quarter.

Robert Young: The first question comes from the line of Robert Young from Kind of Co-Genuity. Please go ahead.

Speaker Change: Your first question comes from the line of Robert Young from Canaccord Genuity. Please go ahead.

Robert Young: Hi, good evening.

Robert Young: The organic growth increased sequentially, as you noted, from 4% to 8%, but ARR, the percentage of the revenue, declined from 3% to 29%.

Speaker Change: The organic growth increased sequentially as you noted.

Robert Young: From 4% to 80%, but <unk>.

Speaker Change: The percentage of the revenue decline from 3% to 29% so.

Matthew Proud: It feels as though the organic growth came from other parts of the business. Maybe you could just break up in a part for me and give me a little more insight into where the growth is coming from here. Yeah, so Rob, the ARR growth did decrease of the percent of total revenue. It mainly result of the increase in overall transactions in the fourth quarter. As I said earlier, the fourth quarters are high points of typically real estate transactions, so that decrease the percentage; although the absolute number did increase. We are seeing growth in other areas of decay and market, in particular the due diligence side as well as the financial services side, as well that all with the organic growth in the quarter.

Speaker Change: It feels as though.

Speaker Change: The organic growth came from other parts of the business, maybe if you could just break up.

Speaker Change: Apart for me and give me a little more.

Speaker Change: Insight into where the growth is coming from here.

Matt Proud: We believe multiple levers exist to continue driving value creation at Dianner. On the transactional side of the business, the interest rate environment supports the normalization of market activity in real estate and M&A. These are just two of the few drivers that are macro drivers in our transactional business. More transactions across our customer base generates more fees. Given our scale, this incremental revenue has an outside impact on our bottom line. It is little to no incremental cost to additional transactions.

Speaker Change: Yeah. So rob the there are growth did decrease as a percentage of total revenue is mainly a result of the increase in overall transactions in the fourth quarter as I said earlier, the fourth quarter as our high point of.

Speaker Change: Typically real estate transactions, so that decreased the percentage, although the absolute number did increase.

Speaker Change: We are seeing.

Speaker Change: Growth in other areas of the Canadian market, and particularly the due diligence side as well as the financial services side as well.

Matt Proud: We also can optimize the market position and positioning of our pricing and transaction offering. As we develop new functionalities and enhance and expand our application set, we are allowing our pricing strategy with the value we deliver to our customers. Edged the evidence by our results are strategies working. Organic growth rate came in at 8% during the fourth quarter. A number we're very proud of. Our market positioning and the green shoot in the macro market activity are bolstering our growth.

Speaker Change: With the organic growth in the quarter.

Robert Young: Okay, and then you said that the two acquisitions that you've made post quarter, they used to 21 million. Was that for both? Was is that the cash outflow for both of those acquisitions in total? That's correct.

Speaker Change: Okay.

Speaker Change: And then you said that the two acquisitions that you'd made post quarter that you said $21 million or is that for both of US is that the cash outflow for both of those acquisitions in total.

Speaker Change: That's correct.

Robert Young: Okay, and then you had a special meaning that you had. scheduled for August, and that's been postponed due to... Is there a question there? Yeah, sits today. We're having trouble. Can you just repeat your question, please? Sure. You had to postpone your special meeting, and I don't believe that there's a replacement date. If you guys give us an overview of where that process sits, then I'll pass the line. Yeah, I can't say too much on that, as you know, the activist shareholder comments litigation against us, which resulted in a judge, which resulted in actions from the courts, which included us spending the meeting or pushing the meeting, because we don't have an outcome from that litigation yet.

Speaker Change: Okay and then.

Speaker Change: You had a special meeting that you had.

Speaker Change: Scheduled for.

Speaker Change: And that's been postponed.

Matt Proud: This resulted. This result, all piece the growth contributed from acquisitions in the quarter. On acquisitions, acquisitions still remain part of our strategy. We will continue to focus on driving, however, we will continue to focus on driving organic growth and when it comes to acquisitions, doing more smaller tuck-in. This will allow us to focus on reducing our leverage ratio. That said, we remain very committed to driving leverage below four times as quickly as possible.

Speaker Change: Or is there a question there.

Speaker Change: Sits today.

Speaker Change: Rob we're having trouble can you just repeat your question. Please.

Speaker Change: Okay.

Speaker Change: Sure.

Speaker Change: You had to.

Speaker Change: Postpone your special meeting and I don't believe that there is a replacement date do you guys give us an overview of.

Speaker Change: Where that process sits.

Matt Proud: At the same time, we have successfully demonstrated our ability to make acquisitions and deliver revenue synergies by cross-selling or to our large customer base in optimizing our pricing strategy of the unmanaged assets in the market. In addition to reducing operational costs, we intend to remain disciplined. To that end, subsequent to June 30th, we've expanded our practice-managed offering across the Asia-Pacific region, the strategic tuck-in of Lexus Affinity in the Asia-Pacific region. This acquisition is aligned with our existing offering and complement our strategic vision of growing air through our practice management offering and owning that intersection of data and PMS software.

Speaker Change: And then I'll pass the line.

Speaker Change: Okay.

Speaker Change: Yes.

Speaker Change: Can't say too much on that as you know the activist shareholders commenced litigation against Us which resulted in a judge.

Speaker Change: Which resulted in actions from the courts, which included US suspending the meeting are pushing the meeting because we don't have a.

Speaker Change: A outcome from that litigation yet we don't have a date for the meeting so we'll keep the market posted as we as we learn more.

Matthew Proud: We don't have a date for the meeting, so we'll keep the market posted as we learn more. Again, this was a result of the activists taking action at us, and as a result of the judge's order, we had to push the meeting.

Speaker Change: Again.

Speaker Change: This was a result of the Actavis, taking actually at us and as a result of that.

Speaker Change: <unk> order, we had to push the meeting.

Robert Young: Okay, thanks for taking the questions.

Matt Proud: The business and headquarter in Sydney, Australia, has approximately 60 employees across the APEC region, including Australia and New Zealand. The Affinity Flagship Paxman Software Service has approximately 12,000 users in medium-sized law firms across the region. The upfront cost for Affinity, the upfront consideration for Lexus Affinity plus another small tuck-in acquisition was $21 million subsequent to June 30th. We were able to negotiate very favorable payment terms on both these acquisitions, meaning the remaining deferred consideration to over 48 million will be payable interest-free over a multi-year period and the company estimates a large portion we paid for as of the free cash flow generated from these businesses.

Speaker Change: Okay. Thanks for taking the questions.

Thanos Moschopoulos: Thank you, and your next question comes from the line of Thanos Michelopoulos. From BMO Capital Markets, please go ahead.

Speaker Change: Thank you and your next question comes from the line of Stan as Michel <unk> from BMO capital markets. Please go ahead.

Matthew Proud: Agnieszkin, from a cost perspective, have you captured all the cost synergies from the restructuring program at this point, or might there be some incremental to come that we're basically the last quarter? We're always watching our cost base and managing it to make sure that we're able to properly deliver both for our customers and our stakeholders, our shareholders most notably. That said, as you know, in the spring of this year, we did identify probably $26 million of costs to come under the business, with a vast majority of that being kind of people related. And while it's always tough to say, people cost that. It was kind of the right thing for the business.

Speaker Change: Hi, good afternoon.

Speaker Change: From a cost perspective have you captured all of them.

Speaker Change: The cost synergies from the <unk>.

Speaker Change: Restructuring program at this point or might there be some incremental.

Speaker Change: To come that works really good luck in the quarter.

Speaker Change: Well.

Speaker Change: Look we're always watching.

Speaker Change: Our cost base and managing it to make sure that we're able to properly deliver both for our customers and our stakeholders.

Speaker Change: Our shareholders most notably.

Martha Vallance: I'm now going to turn over to Martha to speak about a strong track record of capital allocation and acquisition results.

Speaker Change: As you know.

Speaker Change: In the spring of this year, we did identify publicly at $26 million of costs to come out of the business with.

Martha Vallance: Thank you and good afternoon everyone. As Matt mentioned, since the IPO, we have implemented a disciplined acquisition strategy that has significantly scaled the business by deploying approximately 1.9 billion in capital. On slide 17, you can see the impact of these acquisitions. This group of acquired businesses account for more than three quarters of the capital that we've deployed in our acquisition strategy. The performance speaks for itself. Across these acquisitions, we've consistently delivered double-digit, compound annual revenue growth.

Speaker Change: Majority of that being people related and while its always tough to say people cost out who has got the right thing for the business.

Matthew Proud: You know, again, we've executed on a vast majority of those cost savings. There's always kind of more work to do as you kind of can need to manage the business.

Speaker Change: You know again, we've we've executed on them.

Speaker Change: Vast majority of those cost savings, there's always kind of more work to do as you kind of continue to manage the business.

Thanos Moschopoulos: Okay, as far as the acquisitions, just to clarify, Lexus Affinity was the larger one of the two, and then can you comment on which geography the second one was? That's great. Yeah. And yes, it was the larger one, the two. Okay.

Speaker Change: Okay as.

Speaker Change: As far as the acquisitions just to clarify lexis affinity was the larger one of the two and then can you comment on which geography. The second one was.

Martha Vallance: Our largest acquisition due process, we have nearly tripled revenue since we acquired that business in late 2020. More recently, we acquired CRETA, which provides KYC and AML capabilities used by lawyers to verify their customers' identity in the UK. This is a critical part of the customer onboarding process for lawyers and a white-labeled version of the CRETA's technology is already now integrated with our products management applications in the UK, allowing our customers direct access to use this technology.

Speaker Change: Australia and yes, it was a larger one with you.

Speaker Change: Okay.

Thanos Moschopoulos: From a cash flow perspective, any puts and takes we should think about in the year term. Obviously, there's a fact that, you know, some of your interest costs are semi-annual, but aside from that, any specific puts and takes you should think about as we pick up the first half of the year.

Martha Vallance: Despite having known this business for less than a year, the revenue of CRETA is up over 30% since we closed the acquisition, and we expect strong performance to continue as we drive further adoption of this product amongst our CRETA customers. Our acquisition strategy has been centered around building a platform of scale and bringing together mission-critical technologies used in the legal and financial sector. We have been able to drive outsize returns for many of these acquisitions because they fit strategically into the business and the platform that we are building.

Speaker Change: Cash flow perspective.

Speaker Change: Any puts and takes we should think about.

Speaker Change: Near term I mean, obviously there is the fact that.

Speaker Change: Some of your interest costs are semi annual but put aside for that any specific puts and takes we should think about as we think about first half of the year.

Thanos Moschopoulos: Yeah, so Rob, sorry, Thanos. Yeah, you're right. It secures the bond is paid semi-annually, so that the next one is in October. So, so you should have reflected that. As I mentioned, my preferred remarks. You know, there were a higher amount of severance costs that hit in Q4, and we expect a similar amount in Q1. Um, and those are the still only two, I would say factors right now reflecting us going forward, as long with the continued business momentum that we have that's generating strong cash flow.

Speaker Change: Yeah, So Rob me sorry Thanos.

Speaker Change: Yes.

Rob: Youre right the securities the bond is.

Rob: Semi annually so that the next one is in October.

Speaker Change: So you Shouldnt have reflected that as I mentioned in my prepared remarks.

Speaker Change: There were the higher amount of severance costs that hit in Q4, and we expect a similar amount in Q1.

Speaker Change: And those are the only two I would say factors right now affecting us going forward along with the continued business momentum that we have thats generating strong cash flows.

Thanos Moschopoulos: I'd add that we would do remain pretty laser focused on, you know, reducing one-time charges. And a lot of the capital assessment that we've made over the last couple of fiscal years is shrinking significantly. So those are two areas that we are focused on. All right, that's one thing.

Speaker Change: I'd add to that we would do remain pretty laser focused on.

Martha Vallance: Well, this slide looks at the performance on a case-by-case basis, pulling back to our full-sale view on the next slide, you can see the overall impact. We reported approximately 40 million of adjusted evida at the time of our ideas. We've acquired 113 million in evida since that time at a cost of 16.6 times evida. We've created significant value from those acquisitions with 103 million organic adjusted revenue growth off of our pre-IPO and acquired evida base.

Speaker Change: Reducing.

Speaker Change: One time charges.

A lot of the capital investments that we've made over last couple of fiscal years.

Speaker Change: <unk> is shrinking.

Speaker Change: Significantly so those are the two areas that we're focused on.

Speaker Change: Okay.

Speaker Change: Great I'll pass along thanks.

Scott Fletcher: Thank you. And your next question comes in the line of Scott Fletcher from CABC.

Scott <unk>: Thank you and your next question comes from the line of Scott <unk> from CIBC. Please go ahead.

Scott Fletcher: Please go ahead. Hi, good evening. I wanted to ask just, you mentioned sort of the focus being on tuck-in M&A and your prepared remarks, with these sort of these two deals sort of combining to be 20 up front and 60 all in.

Scott <unk>: Hi, Good evening I wanted to ask just you mentioned sort of the focus being on tuck in M&A in your prepared remarks.

Martha Vallance: Our ability post-acquisition to repeatedly drive financial upside and extract incremental value from these businesses has meant that our post-energy evida acquisition multiple is now down to 8.75. We will remain disciplined with our acquisition strategy. We will deploy capital carefully on strategic tech and acquisitions where we are confident that we can repeat our track record of driving strong post-acquisition performance, and we will do this in parallel with our debt repayment targets.

Speaker Change: Two deals are combining to be 20 upfront and 60 all in maybe if you could just help if you could define sort of what you see as a tuck in and what we can expect size wise looking forward.

Matthew Proud: Maybe you could just help if you could define sort of what you see as a tuck-in and what we can expect size-wise looking forward. Yeah, I mean, I would define both of those as tuck-in. In those cases, I mentioned, you know, while it was kind of the 20 up front, we were able to negotiate. We said my prepared remarks, very favorable by vendor financing terms, which enable us to pay for the remainder of the amount to interest free out of the majority of the cash flow of the coming years. So those are obviously very good opportunities.

Speaker Change: Yes, I mean, I would define both of those as tuck in in those cases I mentioned.

Speaker Change: While it was kind of December 'twenty upfront.

Speaker Change: We were able to negotiate this in my prepared remarks, very favorable vendor financing terms, which enable us to pay for the remainder of the two interest free.

Frank Liso: I'll now turn it over to Frank to discuss the financials. Thank you, Martha and good afternoon everyone. This afternoon, we reported a fourth quarter in year-end fiscal 2024 results. Our results continue to demonstrate resiliency and diversification of the business, support and growth in our practice management offerings, and our annual current revenue continues to grow, which reduces the reliance on real estate transactions. Our annual contracted revenue remains robust driven by both our practice management and our payments infrastructure service lines.

Speaker Change: The majority of the cash flow for the coming years.

Speaker Change: So those are obviously very good opportunities.

Matthew Proud: You know, and we kind of had a hard to come by. So it's particularly given the strategic nature of the business. Those are the tuck-ins that we're looking for going forward in the near term, anyways, with a larger focus. Again, in the near term on, keep continuing to go to market to our organic growth. And we are again focused on reducing that leverage ratio. Okay, thanks.

Speaker Change: Sure.

Speaker Change: And we kind of its hard to come by so, particularly given the strategic nature of the business.

Speaker Change: Those are the type of tuck ins that we're looking for.

Speaker Change: Going forward in the near term anyways with.

Speaker Change: With a larger focus in the near term on keep continuing to go to market drive organic growth.

Frank Liso: Revenue exposed to real estate transactions globally in Q4 was 50% compared to 58% in the same period of fiscal 2023. It's important to keep in mind that fiscal 24 is the strongest seasonal period for real estate transactions. Revenue exposed to real estate transactions in Canada was only 28% compared to 33% in the same period of last year. Our actual exposure to real estate transaction is even lower than 28% as the Canadian figures include refinancing transactions.

Speaker Change: We're again focused on reducing that debt our leverage ratios.

Speaker Change: Okay. Thanks, and then just on on that business sort of as you said it fits with the strategy is that something just to clarify is that something where your due diligence product in Australia can be integrated go to market in the same way you plant you do with unity and then will it be rebranded as unity.

Matthew Proud: And then just on that business, sort of, as you said, it fits with the strategy.

Matthew Proud: Is it something just to clarify? Is that something where your due diligence product in Australia can be integrated to go to market in the same way you plan, you do with Unity? And then will it be rebranded as Unity in Australia? Is that the idea? Yeah. Yeah, sure.

Speaker Change: Australia, that's the idea.

Matthew Proud: I'll take that. So in last night, this actually our due diligence product is already integrated there prior to the acquisition is integrated with both us in a competitor of ours. So there is a very meaningful kind of cross law opportunity there. And then yes, ultimately, you know, both acquisitions will be rebranded to our Unity practice management brand.

Speaker Change: Yeah sure I'll take that.

Speaker Change: No.

Max: Max is actually our due diligence product is already integrated there prior to the acquisition and integrate it with both us and our competitor of ours, but there is a.

Frank Liso: Annual recurring contracted revenue was 29% as of June 30th compared to 18% at the same point in the prior year. As Matt mentioned, there are components of our revenue, which we do not include in ARR, such as revenue from contracted overdues and other revenues under contract with service arrangements. These are included in annual contracted revenue, which includes AR and was 51% in the fourth quarter compared to 39% in the prior year period.

Speaker Change: <unk>, a very meaningful kind of cross sell opportunity there and then yes.

Speaker Change: Acquisitions will be rebranded to our energy practice management Brian.

Scott Fletcher: Okay, thanks. That's helpful. Appreciate it.

Speaker Change: Okay. Thanks, a couple I appreciate it.

Speaker Change: Okay.

Stephen Bowen: Thank you. And your next question.

Speaker Change: Thank you and your next question comes from the line of Stephen Boland from Raymond James. Please go ahead.

Stephen Bowen: Class of the line of Stephen Bowen from Raymond James. Please go ahead. Thanks. Maybe just going back to the activists, when your press releases, it did say that the court hearings were expected to be at the end of August. I'm just wondering. I know you can't talk much about them, but do those hearings actually take place? Yes, there wasn't a hearing at the end of August. And we're waiting on a decision from the court. Okay. Okay, that's helpful.

Frank Liso: We reported revenues of 120 million and 458 million in the fourth quarter and fiscal year 2024 respectively. This represents growth of 15 and 14% respectively compared to the corresponding periods in fiscal 23 when taken into consideration the sale of TM in August of 2023. Revenue was unchanged in two four year over year and grew 1.5% in fiscal 2024, including the impact of TMG in the prior period, mainly as a result of organic initiatives.

Stephen Boland: Thanks, maybe just going back to the activists one of your press releases that could say that.

Speaker Change: Court hearings were expected to be at the end of August I'm, just wondering I know you can't talk much about them, but.

Speaker Change: Hearings actually take place.

Speaker Change: Yes, there was a hearing at the end of August.

Speaker Change: And we're waiting on.

Speaker Change: A decision from the court.

Speaker Change: Okay.

Speaker Change: Okay. That's helpful.

Stephen Bowen: Second question. Last quarter, you gave some guidance in terms of, you know, the coming strengths of the quarter years reported. You talked about, you know, kind of record revenue, very strong EBITDA.

Speaker Change: Second question.

Speaker Change: Last quarter, you gave some guidance in terms of the <unk>.

Frank Liso: We generated ajustity of 69 million and 258 million in the fourth quarter and fiscal 2024 periods respectively. The growth of 5 and 6% in their respective periods was despite the divestiture of TM and its contribution in the prior period. The improvements were primarily related to the growth and organic initiatives as well as the impact of our business improvement plan and lower direct cost. We continue to maintain our strong beta margins, coming in at 57% in the quarter and 56% for the fiscal year, which is in line with our target range between 50% and 60%.

Speaker Change: <unk> strengthened the quarter you've reported.

Speaker Change: You talked about kind of record revenue very strong EBITDA I'm wondering if that momentum has carried into.

Matthew Proud: I'm wondering, you know, if that momentum was carried into, you know, the, I guess it would be your Q1 25 quarter. And if you want to provide any kind of run rate or, you know, it's going to be a similar quarter in terms of the guidance. And maybe I have provided it, Paul. Yeah, no, look, to give you color, look, our business continues to form well. I talked about, you know, close to record, and as I said, when you back out the divestiture, it was a record revenue quarter, Q4. Q1, you can use, look, very strong, our business brand very well.

Speaker Change: Our distributor Q1, 'twenty five quarter, and if you don't want to provide any kind of run rate or.

Speaker Change: We're going to be similar quarter in terms of guidance, maybe I'll provided I apologize on behalf.

Speaker Change: Yes.

Speaker Change: To give you color.

Speaker Change: Look our business continues to perform well I talked about.

Rose to record and as I said when you back out the divestiture was a record revenue quarter Q4.

Speaker Change: Q1, local news look very strong our business growing very well.

Matthew Proud: I mentioned that kind of, that what we're seeing is that the strong, continued growth in ARR, which is important to us, but I was translating to into financial performance, so we're very happy with the business is heading, and they're very bullish and positive in the business.

Speaker Change: Mentioned that kind of what.

Frank Liso: We continue to maintain 200 million for the quarter and fiscal year periods respectively, or 43% and 44% of revenue. Adjusted operating expenses for the quarter and fiscal year were lower by approximately 3.4% and 7.3 million respectively from the prior periods, which demonstrates the improvements from our business improvement plan. Net finance costs for the quarter were 114 million and 228 million for the fourth quarter and fiscal year periods respectively compared to 37 million and 132 million in the corresponding periods of fiscal 23.

Speaker Change: What we're seeing is the strong continued growth in <unk>, which is important to us but process translating to into financial performance. So we're very happy with where the business is heading.

Speaker Change: We're very bullish in parts of the business.

Speaker Change: Okay.

Matthew Proud: Okay, and then it was touched on a little bit, but just, you know, we talked a little bit, you talked a little bit about cash flow, about what about, you know, capital allocation in general. I mean, the SIP, you know, is there going to be another attempt for that, to pay down some additional debt, or some of your, sorry, your, your complaints, you know, what's the, the feeling on top of the allocation? Yeah, in regards to the SIP, it's a good question. As a condition of the, the larger refinancing we did, which really gave us a lot of flexibility and certainty of our capital structure the next five years, we required to make an offer to the, to the convert holders, what we did, you know, we, we need to hold that cash and escrow on, on hand, to, to fulfill the obligation when it comes to, and I think a year and a half from now, so, so we don't have any intent to, to, currently, to, to make another offer.

Speaker Change: Okay.

Speaker Change: And then.

Speaker Change: It was touched on a little bit but.

Speaker Change #100: We talked to you a little bit you talked a little bit about cash flow, but what about capital allocation in general.

Speaker Change: B.

Speaker Change #101: Is there going to be another attempt for that.

Speaker Change #102: To pay down some additional debt or some of your sort of your converts.

Frank Liso: The changing Q4 was primarily due to non-cash impacts arising from changes in the fair value of our control ventures, contingent considerations, frost currency swaps, and a loss of settlement on our retired areas facility. Adjusted finance costs was the just for these changes in fair value and settlement losses was 31.4 million lower by 4 million versus the prior Q4 period, which primarily reflects the savings from our refinancing transaction completed in April of 2024.

Speaker Change #102: What's the ceiling on our capital allocation.

Speaker Change #102: Yeah.

Speaker Change #104: In regards to the <unk> side, it's a good question.

Speaker Change #104: As a condition of the larger refinancing, we did which really gave us a lot of flexibility a certainty of our capital structure over the next five years, we required Jamaica and offer to the to the convert holders, which we did.

Speaker Change #104: We continue to hold that cash in escrow on hand.

Speaker Change #104: Sure.

Speaker Change #105: They have an obligation when it comes due and I think a year and a half from now.

Speaker Change #105: So we don't have any intent to currently to make another offer I think at this point, we're making a positive carry on the interest on our casting health.

Frank Liso: Acquisition restructuring and other costs were 9 million and 29 million for the fourth quarter and fiscal 24 periods compared to 9 million and 59 million respectively in the prior period. The quarterly period was in line with with the previous year. You can see the significant improvement we've made in the annual period, a 52% reduction compared to fiscal 2023. We believe we can deliver additional improvements in this cost over time as we take additional actions to increase our cash flow performance.

Matthew Proud: I think at this point we're making a positive carry on the interest on that cash being held, so it works well for us, and we're obviously making more interest than we're paying in interest on that convert. So, to the second point of your comment, look, we're really committed. I would tell the capital locations and getting our leverage ratio below four times as soon as possible. We, we know that's an impediment to the business; it's, we don't investors want that. We understand the importance of it; it's a public company, and we're committed to, to, to get that quickly.

Speaker Change #105: Well for us and we're obviously, making more interest and we're paying an interest on that convert.

Speaker Change #106: So to the second point of your of your comment look we're really committed I would note capital location that getting our leverage ratio below four times as soon as possible.

Speaker Change #106: We know Thats, an impediment to the business.

Speaker Change #106: We know investors want that we understand the importance of it as a public company and we're committed to get there quickly.

Frank Liso: The gains made from our business improvement plan earlier in the year support a significant free cash flow in the quarter. We have fully realized 70 million targeted free cash flow benefit from that plan in Q4 relative to the baseline period of fiscal of Q1. We have introduced a new non-gath keep performance measure which will continue to report on leverage free cash flow leverage free cash flow was 32 million in the fourth quarter.

Matthew Proud: Okay, and, and just the, the, the, the, the Lexus, the two acquisitions, I mean, are these businesses that you've known for years and years, and it was an option, and just curious how about some of this is still progressing, you know, after so many deals that you've done. Yeah, Daniel, on the case of one, we have a long-standing relationship with, with, with, with Lexus Nexus. They're obviously one of the largest, the largest legal tech companies out there up the Compton Reuters, and this is something working on it for, for over a year. And, and, and, and it was a very good opportunity for us with very stable financing terms. It was a unique, a unique opportunity that it was kind of hard to turn down.

Speaker Change #106: Okay.

Speaker Change #106: And just.

Speaker Change #107: The Lexus.

Speaker Change #107: Acquisitions.

Speaker Change #108: Are these businesses that you've known for years and years and consider an auction I'm just curious how about some of this is still progressing after so many deals that you've done.

Speaker Change #107: Yes.

Speaker Change #109: On the case of why we have a long standing relationship with.

Speaker Change #109: Lexisnexis previously one of the largest the largest single tech companies out there with Thomson Reuters.

Frank Liso: That is an improvement of 38 million compared to when we initiated the business improvement plan in the first quarter of fiscal 21. Even when taking into consideration the secured secure no interest impact which is paid semi annually, it is still a 24 million positive improvement or approximately 96 million annualized. This improvement includes savings achieved in a reduction of capital expenditures, lower net interest costs, lower adjusted operating expenses, as well as lower cash taxes paid.

And this is something we're working on for over a year.

Speaker Change #109: And it was a very good opportunity for us with very favorable financing terms with a huge opportunity that it was kind of hard to turn down.

Matthew Proud: Okay, for sure, it's comments, thanks to us.

Speaker Change #110: Okay I appreciate the comments thanks guys.

Speaker Change #109: Okay.

Kevin Krishnaratne: Thank you, and your next question comes on the line of Kevin Krishna Ratney from Scotia Bank. Please go ahead. Hey there, I'm good evening. Just a question on your ARR mix; it was 30%. I know you've given targets of getting to 50%; I can't recall when that, you know, timeline is, but you have a view of where you like this metric to be at the end of the current 2025. Yeah, so yeah, we, you're right, Kevin, we do have those public metrics that has not changed. So we'd like to reach 40% by the end of this fiscal period, and then get to 50% beyond for the next fiscal period.

Speaker Change #111: Thank you and your next question comes from the line of Kevin Kushner Edney from Scotia Bank. Please go ahead.

Speaker Change #112: Hey, there good evening.

Question on your E. R. R mix it was 30%.

Frank Liso: The cost reduction plan arising from our refinancing transaction did result in a higher amount of severance costs in the fourth quarter and we expect to continue into the first quarter of fiscal 25. Due to the realization of synergies which will have a benefit impact for the remainder of 2025 and beyond. As part of our emergency transaction, we've also implemented new cross currency swaps, which effectively hedge 100% of the cash for an exchange movements and 85% of the interest rate movements.

Speaker Change #113: I know you've given targets of getting to 50% I can't recall when that timeline is but you have a view of where you'd like.

This metric to be at the end of the current 2025.

Speaker Change #113: Yes, so yes, you're right Kevin we do have.

Speaker Change #114: Those public metrics that has not changed.

Speaker Change #115: So we'd like to reach 40% by the end of this fiscal period.

Speaker Change #115: And then get to 50% beyond for the next fiscal period.

Kevin Krishnaratne: Okay, got it. Thanks for that.

Frank Liso: These swaps will have market market non-catch adjustments, which will result in period of period variability in our finance ventric. You will see this in the fourth quarter, the $20 million expense toward finance costs. Now, turning to our balance sheet, our net debt stood at approximately 1.26 billion as of June 30th, 2024, which has been reduced by approximately 36 million since June 30th of 2023. As we discussed in the last fall, we repaid all of our amounts outstanding under the Air Risk Credit Facility, with the proceeds from the Refinancing Transaction.

Speaker Change #116: Okay got it thanks for that on the minimum volume pricing sort of strategy can you talk about like the sort of behavior that youre seeing from from your clients from you know a lawyer lawyers offices went like how are they setting the minimum do you see do you feel like they're basically setting the minimum off of that.

Matthew Proud: On the minimum volume pricing sort of strategy, can you talk about the sort of behavior that you're seeing from your clients, from lawyers' offices? Like, how are they setting the minimum? Do you feel like they're basically setting the minimum off the current sentiment in the market, or are they booking in a little bit more transactions, being optimistic? Like, what are you seeing in terms of what they're setting, and how do you think about if there is upside to come beyond at a faster rate than what might be currently in the market? Will you be able to cap to that in terms of beyond the minimums? Just curious on what you're seeing sort of as these guys are setting the minimums. Yeah, so a couple things, keep in mind, this doesn't only apply to law firms that are involved in real estate transactions.

Speaker Change #116: The current sentiment.

Speaker Change #117: Sentiment in the market or are they.

Speaker Change #116: No.

Speaker Change #118: Looking at a little bit more you know more transactions being optimistic like what what do you. What are you seeing in terms of what they are setting and how do you think about.

Speaker Change #118: If there is upside to come beyond you know at a faster rate than what you know it might be currently in the market. We will you will you be able to capture that in terms of beyond the minimums I'm just curious on what Youre seeing sort of these guys are setting the minimums.

Frank Liso: The Refinancing Transaction in Canadian dollars consisted of approximately $254 million of senior secured notes due in 2029 and approximately $476 million in senior secured term loan B facility due in 2031 and $105 million revolving threat of facility. We understand the importance of reducing our leverage and we've set a target to reduce it below four times total net debt to adjust the EBITDA. That said, we have sufficient resources to manage our debt levels. The business generates strong, sustainable cash flows.

Speaker Change #119: Yes, so just a couple of things keep in mind. This doesn't only apply to two law firms that are involved in real estate transactions. We have a lot. Many customers that are using our products for corporate commercial type searches in a regulatory filings that we do the same thing with <unk>.

Matthew Proud: We have a lot, many customers that are using their products with corporate commercial type searches and regulatory filings that we do the same thing with. So, at the answer to your question more specifically, we have tiers and pricing associated with tiers for our customers. As a business, we always want to get more minimum spend, and obviously clients obviously want to give you less, so it's an ongoing negotiation between our reps and the client on where they can best fit. We've done a lot of work over the last 12, even 18 months, and there's still a bit to go in some areas of business where the tiers aren't standardized enough, and it's more based on percentages of spend.

Speaker Change #119: So but to answer your question more specifically.

Tears and pricing associated with tiers for our customers are as a business. We always wanted to get more minimum standard obviously the clients obviously want to give you less so it's an ongoing negotiation between our reps and our account managers and the client on to where they can best fit we've done a lot of work.

Operator: With that, I'll turn it back to the operator for the Q&A. Thank you, ladies and gentlemen. We will now begin the question analysis session. Should you have a question please by starfall by the one on your telephone keypad? Should you wish to cancel the request please by starfall by the two? If you're using your speaker phone please lift the handset before pressing any keys. One moment please for your first question.

Speaker Change #119: Over the last.

Speaker Change #119: 12, and 18 months.

Speaker Change #119: And there's still a bit to go in some areas of the business, where there were the tiers are standardized and often its more based on percentages spend we want to get where it's all standardized and what kind of a lot of the way there, but not all the way there, but I hope that gives you some color and help us understand kind of how we approach it yes.

Robert Young: The first question comes from the line of Robert Young from kind of co-genuity. Please go ahead. The organic growth increased sequentially as you noted from 4% to 8%, but ARR, the percentage of the revenue declined from 3% to 29%. It feels as though the organic growth came from other parts of the business.

Matthew Proud: We want to get where it's all standardized, and we're kind of a lot of the way there, but not all the way there. But I hope that gives you some color and helps understand kind of how we approach it. Yeah, no, it's helpful. Thanks for that, Matt.

Speaker Change #119: Yes, no that's helpful. Thanks for that Matt.

Frank Liso: Maybe for Frank, just to remind on the cash flow dynamics of the minimum, you can't recall. Do you get the cash on a minimum payment all up front, beginning of the year? Is it every month, every quarter? How does the cash come in? Yeah, the majority of the contracts are over three years, three years and ten year, and we get the cash. If they do not miss their minimum guarantee, we get the cash at the end of each of those three years. At the end of each of those years, okay, thanks.

Speaker Change #119: Frank.

Speaker Change #120: Remind on the sort of the cash flow.

Speaker Change #121: <unk> dynamics over the minimums can't recall.

Frank: Are you do you get the cash on the minimum payment all upfront beginning of the year that every month every quarter how does the cashman.

Ross Hirji: Maybe you could just break up in a part for me and give me a little more insight into where the growth is coming from here. Yeah, so Rob, the ARR growth did decrease of the percent of total revenue. It mainly result of the increase in overall transactions in the fourth quarter. As I said earlier, the fourth quarters are high point of typically real estate transactions so that that decrease the percentage, although the absolute number did increase.

Frank: Yes.

Frank: The majority of the contracts are over three years three years in tenure and we get the cash.

Frank: Do not meet their minimum guarantee we get the cash at the end of each of those three years.

Speaker Change #122: At the end of each of those years okay. Thanks.

Matthew Proud: Just the last one for me; I had a press release out. It might have been a few weeks ago, just on the mortgage discharge product. I know that that product is in Quebec and in Australia. But if you think about in Canada, can you remind us of how that big business is in Quebec, and how do you think about what that ham opportunity is in Canada? Yeah, it's a good question. Look, we think as we talk in the past; it's a very large ham. And obviously, Quebec, we kind of have that full settlement business, where we're involved in settling a very large majority of all mortgages in that market.

Speaker Change #123: Just the last one for me you had a press release out might have been a few weeks ago, just on the mortgage discharge product they know that that product isn't in Quebec.

Ross Hirji: We are seeing growth in other areas of decay and market in particular the due diligence side as well as the financial services side as well that all with the organic growth in the quarter. Okay, and then you said that the two acquisitions that you've made post quarter they used to 21 million was that for both was is that the cash outflow for both of those acquisitions in total? That's correct. Okay, and then you had a special meaning that you had, scheduled for August, and that's been postponed due to... Is there a question there?

Speaker Change #124: And in Australia, but if you think about in from Canada, and can you remind us of how big that business is in Quebec, and how do you think about you know what that Tam opportunity is in Canada.

Speaker Change #125: Yes, it's a good question.

Speaker Change #126: Look we think as we've talked in the past a very large tam.

Speaker Change #126: And obviously, Quebec, we kind of have that full several business, where we're involved in settling a very large majority of all of our mortgages.

Speaker Change #126: That market.

Matthew Proud: The English Canada is very fragmented and decentralized in how payments and the settlement mortgages happen, so the property transaction has to say. So look, it is an incremental process. You have one bank, the next bank, the next bank. So today, we have BMO and National Nationwide. And so it's our goal to keep adding more banks, and eventually trying to replicate what we've done in the province of Quebec. Just to set expectations, it does take a long time. It took decades to do this in Quebec. Australia took government interventions, so for PACs to do it. So we're doing it slowly and organically.

English, Canada, very fragmented and decentralized and how payments and the and the settlement of mortgages happens. So a property transaction as you say.

Ross Hirji: Yeah, sits today. We're having trouble. Can you just repeat your question, please? Sure. You had to postpone your special meeting, and I don't believe that there's a replacement date. If you guys give us an overview of where that process sits, then I'll pass the line. Yeah, I can't say too much on that, as you know, the activist shareholder comments litigation against us, which resulted in a judge, which resulted in actions from the courts, which included us spending the meeting or pushing the meeting, because we don't have an outcome from that litigation yet.

Speaker Change #126: Okay.

Speaker Change #127: It is an incremental process you had one bank the next bank the next bank.

Speaker Change #128: So today, we have BMO in national.

Speaker Change #128: Asian wide and so it's our goal to keep adding more banks and eventually try to replicate what we've done in the in the province of Quebec.

Speaker Change #128: Just to set expectations. It does take a long time.

Speaker Change #128: It took decades to do this in Quebec.

Speaker Change #128: Trailer to government intervention to for <unk> to do it.

So it's we're doing it slowly and organically when you get there it really creates a lot of value for your customers. When you can seamlessly.

Matthew Proud: When you get there, it really creates a lot of value to your customers. When you can seamlessly settle a mortgage or a property transaction, it's a lot of value. Oh, got it.

Speaker Change #128: Several mortgage or property transactions.

Ross Hirji: We don't have a date for the meeting, so we'll keep the market posted as we learn more. Again, this was a result of the activists taking action at us, and as a result of the judge's order, we had to push the meeting.

Speaker Change #129: Got it okay. That's it for me I'll pass the line. Thank you.

Matthew Proud: Okay, that's it for me. I'll pass it on.

Operator: Thank you.

Speaker Change #128: Okay.

Operator: Once again, that is start and wanted to ask a question.

Speaker Change #128: Thank you once again that is star and wanted to ask a question. Your next question comes from the line of Gavin Fairweather from Cormack. Please go ahead.

Gavin Fairweather: Your next question comes from the line of Gavin Fairweather from Cornmark.

Gavin Fairweather: Peace, go ahead. Oh, hey, good afternoon. First one for me.

Gavin Fairweather: Oh, Hey, good afternoon first one for me maybe you can just touch on the UK business I know one of your growth Lee birth was to bundle search and with the practice management business can you provide us an update on how that initiative is progressing.

Gavin Fairweather: Maybe you can just touch on the UK business, and I want to be a gross believer's list to bundle search in with practice management business. Can you provide us an update on how that initiative is progressing? So, that that's an issue that's underway. It is, it is practice, injury, ARR. We don't disclose the exact numbers that we've been talking from that, but what other customers that it applies to, we have been very successful in taking customers to your practice management and being able to put them on minimum spend contracts for the real state and property searches they require to drive additional upside.

Speaker Change #131: So thats initiatives that's underway.

Speaker Change #131: It is it is.

Speaker Change #132: <unk>, we don't disclose the exact numbers that we've garnered from that but but of the customers that it applies to we have been very successful in taking customers of your practice management.

Robert Young: Okay, thanks for taking the questions.

Thanos Moschopoulos: Thank you, and your next question comes from the line of Thanos Michelopoulos. From BMO Capital Markets, please go ahead. Agnieszkin, from a cost perspective, have you captured all the cost synergies from the restructuring program at this point, or might there be some incremental to come that we're basically the last quarter? We're always watching our cost base and managing it to make sure that we're able to properly deliver both for our customers and our stakeholders, our shareholders most notably.

Speaker Change #133: Being able to put them on minimum spend contracts for the for the real estate and property searches they require.

Speaker Change #134: To drive additional upside so we'll see those results a lot of that activity happen in the late half of fiscal 'twenty. Four so we should see a lot of that that benefit in the coming fiscal year.

Gavin Fairweather: So we'll see those results. A lot of that activity happened in the late half of Fiscal 24. So we should see a lot of that benefit in the coming fiscal year. Okay, that's helpful.

Speaker Change #135: Okay. That's helpful and then on the Canadian business, maybe just on the refinance side I mean, you touched about.

Gavin Fairweather: And then on the Canadian business, maybe just on the refinance side, we touched about green shoots on the transactional revenue line. If you're starting to see you with that, with rates falling down a bit more of a robust or normalizing refinance line coming out of that community business. Yeah, not a ton. I mean, the real, the revenue we generate related to Canadian real estate transactions remains kind of sluggish. You know, what we're seeing is a lot of the rest of our business, whether it's different from revenue or our FinTech business and or kind of transactions that are exposed to corporate commercial type transactions, are really picking up really significantly, where we're seeing that revenue exposed to real estate being a bit more sluggish.

Green shoots on the transactional revenue line I'm curious, if you're starting to see that with rates falling down a bit more of a R.

Speaker Change #136: Boss start normalizing refinance volume.

Thanos Moschopoulos: That said, as you know, in the spring of this year, we did identify probably $26 million of costs to come under the business with a vast majority of that being kind of people related. And while it's always tough to say people cost that, it was kind of the right thing for the business. You know, again, we've executed on a vast majority of those cost savings.

Speaker Change #135: Sure.

Yes, not autonomy, the Canadian business, the real or the.

Speaker Change #137: The revenue, we generate related to Canadian real estate transactions remains sluggish.

Speaker Change #137: What we're seeing is a lot of the rest of our business.

Whether it's subscription revenue.

Speaker Change #137: Our fintech business <unk> kind of transactions that are exposed a corporate commercial type transactions are really picking up really significantly where we're seeing the revenue exposure with real estate being a bit more sluggish.

Thanos Moschopoulos: There's always kind of more work to do as you kind of can need to manage the business. Okay, as far as the acquisitions just to clarify, Lexus Affinity was the larger one of the two, and then can you comment on which geography the second one was? That's great. Yeah. And yes, it was the larger one, the two.

Gavin Fairweather: But look, those interest rates come down; remain optimistic. At some point, that comes back and it's a huge cash to the business. So we're excited when that day comes. Okay, thanks. We'll stay tuned.

Speaker Change #137: But look as interest rates come down we remain optimistic at some point that comes back and it's a huge cash shoot for the business.

Speaker Change #137: So we're excited when I began.

Speaker Change #138: Okay. Thanks, I'll stay tuned and then just maybe for Frank just following up on the cash flow discussion. It looks like from my quick scan that the investment in intangibles was higher this quarter can you provide any.

Frank Liso: And then just maybe for Frank just falling up on the cash flow discussion.

Thanos Moschopoulos: Okay. From a cash flow perspective, any puts and takes we should think about in the year term. Obviously, there's a fact that, you know, some of your interest costs are semi-annual, but aside for that, any specific puts and takes you should think about as we pick up the first half of the year. Yeah, so Rob, sorry, Thanos. Yeah, you're right. It secures the bond is paid semi-annually so that the next one is in October.

Frank Liso: It looks like from my quick scan that the investment in the tangibles was low that higher this quarter.

Frank Liso: Can you provide any, you know, expectations are not lying going into 2025. Yeah, the, I think you're referring to the capitalized tangibles that we had. You know, we are, we are obviously drawing that down as overtime. You get more efficient actually prioritizing projects accordingly. So we do expect that line item to be lower in the future. But I think you know, roughly that 25 million dollars annually would be a target range.

Speaker Change #139: Expectations around that line going into 'twenty.

Speaker Change #139: Yes.

Speaker Change #140: Youre, referring to the capitalized tangibles that we had.

Speaker Change #141: We're obviously drawing that down over time.

Speaker Change #142: Kick in more efficient actually prioritizing projects accordingly, so.

Speaker Change #142: So we do expect.

Thanos Moschopoulos: So so you should have reflected that. As I mentioned, my preferred remarks. You know, there were a higher amount of severance costs that hit in Q4 and we expect a similar amount in Q1. Um, and those are the still only two, I would say factors right now reflecting us going forward as long with the continued business momentum that we have that's generating strong cash flow. I'd add that we would do remain pretty laser focused on, you know, reducing one-time charges. And a lot of the capital assessment that we've made over the last couple of fiscal years is shrinking significantly. So those are two areas that we are focused on.

Speaker Change #142: That line item too.

Thanos Moschopoulos: All right, that's one thing.

Speaker Change #142: To be lower in the future.

Unknown Speaker: Thank you.

Speaker Change #142: But I think roughly in that $25 million annually would be would be a target range.

Gavin Fairweather: Okay, that's it for me.

Speaker Change #143: Okay. That's it for me thank you.

Operator: Thank you. There are no further questions at this time.

Speaker Change #143: Thank you there are no further questions at this time I will now hand, the call back to Mr. Hersh for any closing remarks.

Matthew Proud: I will now hand the call back to Mr. Hasher for any closing remarks. Great. Thanks to all of you guys that attended it.

Mr. Hersh: Great. Thanks for all of you guys that attended and we look forward to connecting with you for our Q1 results added <unk> communicated in the near future until then have a great day. Thank you.

Operator: We look forward to connecting with you for our Q1 results on a day to be communicated in the future. Until then, have a great day. Thank you.

Operator: This concludes today's call. Thank you for participating. You may all disconnect. Thank you.

Speaker Change #145: This concludes today's call. Thank you for participating you may all disconnect.

Scott Fletcher: And your next question comes in the line of Scott Fletcher from CABC. Please go ahead. Hi, good evening. I wanted to ask just, you mentioned sort of the focus being on tuck-in M&A and your prepared remarks, with these sort of these two deals sort of combining to be 20 up front and 60 all in. Maybe you could just help if you could define sort of what you see as a tuck-in and what we can expect size-wise looking forward.

Scott Fletcher: Yeah, I mean, I would define both of those as tuck-in. In those cases, I mentioned, you know, while it was kind of the 20 up front, we were able to negotiate. We said my prepared remarks, very favorable by vendor financing terms, which enable us to pay for the remainder of the amount to interest free out of the majority of the cash flow of the coming years. So those are obviously very good opportunities.

Scott Fletcher: You know, and we kind of had a hard to come by. So it's particularly given the strategic nature of the business. Those are the tuck-ins that we're looking for going forward in the near term anyways with a larger focus. Again, in the near term on, keep continuing to go to market to our organic growth. And we are again focused on reducing that leverage ratio.

Matt Proud: Okay, thanks. And then just on that business sort of as you said, it fits with the strategy. Is it something just to clarify? Is that something where your due diligence product in Australia can be integrated to go to market in the same way you plan, you do with unity? And then will it be rebranded as unity in Australia? Is that the idea? Yeah. Yeah, sure. I'll take that. So in last night, this actually our due diligence product is already integrated there prior to the acquisition is integrated with both us in a competitor of ours. So there is a very meaningful kind of cross law opportunity there. And then yes, ultimately, you know, both acquisitions will be rebranded to our unity practice management brand. Okay, thanks. That's helpful. Appreciate it. Thank you.

Stephen Boland: And your next question. Class of the line of Stephen Bowen from Raymond James. Please go ahead. Thanks. Maybe just going back to the activists, when your press releases, it did say that the court hearings were expected to be at the end of August. I'm just wondering. I know you can't talk much about them, but do those hearings actually take place? Yes, there wasn't a hearing at the end of August.

Ross Hirji: And we're waiting on a decision from the court. Okay. Okay, that's helpful. Second question. Last quarter, you gave some guidance in terms of, you know, the coming strengths of the quarter years reported. You talked about, you know, kind of record revenue, very strong EBITDA. I'm wondering, you know, if that momentum was carried into, you know, the, I guess it would be your Q1 25 quarter. And if you want to provide any kind of run rate or, you know, it's going to be a similar quarter in terms of the guidance.

Ross Hirji: And maybe I have provided it, Paul. Yeah, no, look, to give you color, look, our business continues to form well. I talked about, you know, close to record, and as I said, when you back out the divestiture, it was a record revenue quarter, Q4. Q1, you can use, look, very strong, our business brand very well. I mentioned that kind of, that what we're seeing is that the strong, continued growth in ARR, which is important to us, but I was just translating to into financial performance, so we're very happy with the business is heading, and they're very bullish and positive in the business.

Ross Hirji: Okay, and then it was touched on a little bit, but just, you know, we talked a little bit, you talked a little bit about cash flow, about what about, you know, capital allocation in general, I mean, the SIP, you know, is there going to be another attempt for that, to pay down some additional debt, or some of your, sorry, your, your complaints, you know, what's the, the feeling on top of the allocation? Yeah, in regards to the, to the SIP, it's a good question.

Ross Hirji: As a condition of the, the larger refinancing we did, which really gave us a lot of flexibility and certainty of our capital structure the next five years, we required to make an offer to the, to the convert holders, what we did, you know, we, we need to hold that cash and escrow on, on hand, to, to fulfill the obligation when it comes to, and I think a year and a half from now, so, so we don't have any intent to, to, currently, to, to make another offer. I think at this point we're making a positive carry on, on the interest on that cash being held, so it works well for us, and we're obviously making more interest than we're paying an interest on that convert.

Ross Hirji: So, to the second point of your comment, look, we're really committed, I would tell the capital locations and getting our leverage ratio below four times as soon as possible. We, we know that's an impediment to the business, it's, we don't investors want that, we understand the importance of it, it's a public company, and we're committed to, to, to get that quickly. Okay, and, and just the, the, the, the, the Lexus, the two acquisitions, I mean, are these businesses that you've known for years and years, and it was an option, and just curious how about some of this is still progressing, you know, after so many deals that you've done.

Ross Hirji: Yeah, Daniel, on the case of one, we have a long-standing relationship with, with, with, with Lexus Nexus. They're obviously one of the largest, the largest legal tech companies out there up the Compton Reuters, and this is something working on it for, for over a year. And, and, and, and it was a very good opportunity for us with very stable financing terms, it was a unique, a unique opportunity that it was kind of hard to turn down.

Unknown Speaker: Okay, for sure, it's comments, thanks to us.

Kevin Krishnaratne: Thank you, and your next question comes on the line of Kevin Krishna Ratney from Scotia Bank, please go ahead. Hey there, I'm good evening. Just a question on your ARR mix, it was 30%. I know you've given targets of getting to 50%, I can't recall when that, you know, timeline is, but you have a view of where you like this metric to be at the end of the current 2025. Yeah, so yeah, we, you're right, Kevin, we do have those public metrics that has not changed. So we'd like to reach 40% by the end of this fiscal period, and then get to 50% beyond for the next fiscal period.

Matt Proud: Okay, got it. Thanks for that. On the minimum volume pricing sort of strategy, can you talk about the sort of behavior that you're seeing from your clients, from lawyers offices, like how are they setting the minimum, do you feel like they're basically setting the minimum off the current sentiment in the market, or are they booking in a little bit more transactions being optimistic, like what are you seeing in terms of what they're setting, and how do you think about if there is upside to come beyond at a faster rate than what might be currently in the market, will you be able to cap to that in terms of beyond the minimums, just curious on what you're seeing sort of as these guys are setting the minimums.

Matt Proud: Yeah, so a couple things, keep in mind, this doesn't only apply to law firms that are involved in real estate transactions. We have a lot, many customers that are using their products with corporate commercial type searches and regulatory filings that we do the same thing with. So, at the answer to your question more specifically, we have tiers and pricing associated with tiers for our customers. As a business, we always want to get more minimum spend, and obviously clients obviously want to give you less, so it's an ongoing negotiation between our reps and the client on the where they can best fit.

Matt Proud: We've done a lot of work over the last 12, even 18 months, and there's still a bit to go in some areas of business where the tiers aren't standardized enough, and it's more based on percentages of spend. We want to get where it's all standardized, and we're kind of a lot of the way there, but not all the way there.

Frank Liso: But I hope that gives you some color and helps understand kind of how we approach it. Yeah, no, it's helpful. Thanks for that, Matt. Maybe for Frank, just to remind on the cash flow dynamics of the minimum, you can't recall, do you get the cash on a minimum payment all up front, beginning of the year, is it every month, every quarter, how does the cash come in? Yeah, the majority of the contracts are over three years, three years and ten year, and we get the cash. If they do not miss their minimum guarantee, we get the cash at the end of each of those three years.

Frank Liso: At the end of each of those years, okay, thanks.

Matt Proud: Just the last one for me, I had a press release out. It might have been a few weeks ago, just on the mortgage discharge product, I know that that product is in Quebec and in Australia. But if you think about in Canada, can you remind us of how that big business is in Quebec, and how do you think about what that ham opportunity is in Canada? Yeah, it's a good question. Look, we think as we talk in the past, it's a very large ham.

Matt Proud: And obviously, Quebec, we kind of have that full settlement business, where we're involved in settling a very large majority of all mortgages in that market. The English Canada is very fragmented and decentralized in how payments and the settlement mortgages happen, so the property transaction has to say. So look, it is an incremental process. You have one bank, the next bank, the next bank. So today, we have BMO and national nationwide. And so it's our goal to keep adding more banks, and eventually trying to replicate what we've done in the province of Quebec.

Matt Proud: Just to set expectations, it does take a long time. It took decades to do this in Quebec. Australia took government interventions, so for PACs to do it. So we're doing it slowly and organically. When you get there, it really creates a lot of value to your customers. When you can seamlessly settle a mortgage or a property transaction, it's a lot of value.

Unknown Speaker: Oh, got it.

Unknown Speaker: Okay, that's it for me. I'll pass it on. Thank you.

Operator: Once again, that is start and wanted to ask a question.

Gavin Fairweather: Your next question comes from the line of Gavin Fairweather from Cornmark. Peace go ahead. Oh, hey, good afternoon. First one for me. Maybe you can just touch on the UK business, and I want to be a gross believer's list to bundle search in with practice management business. Can you provide us an update on how that initiative is progressing? So that that's an issue that's underway. It is, it is practice, injury, ARR.

Gavin Fairweather: We don't disclose the exact numbers that we've been talking from that, but what other customers that it applies to, we have been very successful in taking customers to your practice management and being able to put them on minimum spend contracts for the real state and property searches they require to drive additional upside. So we'll see those results. A lot of that activity happened in the late half of fiscal 24. So we should see a lot of that benefit in the coming fiscal year.

Matt Proud: Okay, that's helpful. And then on the Canadian business, maybe just on the refinance side, we touched about green shoots on the transactional revenue line. If you're starting to see you with that, with rates falling down a bit more of a robust or normalizing refinance line coming out of that community business. Yeah, not a ton. I mean, the real, the revenue we generate related to Canadian real estate transactions remains kind of sluggish.

Matt Proud: You know, what we're seeing is a lot of the rest of our business, whether it's different from revenue or our FinTech business and or kind of transactions that are exposed to corporate commercial type transactions are really picking up really significantly where we're seeing that revenue exposed to real estate being a bit more sluggish. But look, those interest rates come down remain optimistic. At some point that comes back and it's a huge cash to the business. So we're excited when that day comes. Okay, thanks. We'll stay tuned.

Frank Liso: And then just maybe for Frank just falling up on the cash flow discussion. It looks like from my quick scan that the investment in the tangibles was low that higher this quarter. Can you provide any, you know, expectations are not lying going into 2025. Yeah, the, I think you're referring to the capitalized tangibles that we had. You know, we are, we are obviously drawing that down as overtime. You get more efficient actually prioritizing projects accordingly.

Frank Liso: So we do expect that line item to be to be lower in the future. But I think you know, roughly that 25 million dollars annually would be a target range. Okay, that's it for me. Thank you.

Matt Proud: There are no further questions at this time. I will now hand the call back to Mr. Hasher for any closing remarks. Great. Thanks for all of you guys that attended it. We look forward to connecting with you for our Q1 results at a day to be communicated in future. Until then, have a great day. Thank you. This concludes today's call. Thank you for participating. You may all disconnect. Thank you.