Computer Modelling Group Announces Third Quarter Results and Quarterly Dividend

CALGARY, Alberta, Feb. 10, 2026 (GLOBE NEWSWIRE) — Computer Modelling Group Ltd. (“CMG Group” or the “Company”) announces its financial results for the three and nine months ended December 31, 2025, and the approval by its Board of Directors (the “Board”) of the payment of a cash dividend of $0.01 per Common Share for the third quarter ended December 31, 2025.

THIRD QUARTER 2026 CONSOLIDATED HIGHLIGHTS

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• Total revenue decreased by 9% (17% Organic decline⁽¹⁾ and 8% growth from acquisitions) to $32.7 million;
• Recurring revenue⁽¹⁾⁽²⁾ decrease by 4% (14% Organic decline⁽¹⁾ and 10% growth from acquisitions) to $23.7 million;
• Adjusted EBITDA⁽¹⁾ decreased by 30% to $9.7 million;
• Adjusted EBITDA Margin⁽¹⁾ was 30%, compared to 39% in the comparative period;
• Earnings per share was $ 0.07, a 42% decrease;
• Free Cash Flow⁽¹⁾ decreased by 34% to $5.8 million; Free Cash Flow per share⁽¹⁾ decreased to $0.07 from $0.11.

THIRD QUARTER YEAR TO DATE 2026 CONSOLIDATED HIGHLIGHTS

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• Total revenue decrease by 3% (16% Organic decline⁽¹⁾ and 13% growth from acquisitions) to $92.5 million;
• Recurring revenue⁽¹⁾⁽²⁾ increase by 4% (10% Organic decline⁽¹⁾ and 14% growth from acquisitions) to $65.3 million;
• Adjusted EBITDA⁽¹⁾ decreased by 27% to $24.3 million;
• Adjusted EBITDA Margin⁽¹⁾ was 26%, compared to 35% in the comparative period;
• Earnings per share was $0.14, a 33% decrease;
• Free Cash Flow⁽¹⁾ decreased by 41% to $12.2 million; Free Cash Flow per share⁽¹⁾ decreased to $0.15 from $0.25.

_{⁽¹⁾ Organic growth/decline, Adjusted EBITDA, Adjusted EBITDA Margin, Recurring revenue, Free Cash Flow and Free Cash Flow per share are not standardized financial measures and might not be comparable to measures disclosed by other issuers. For more description see under Non-IFRS Financial Measures and Reconciliation of Non-IFRS Measures” heading.
⁽²⁾ Recurring revenue includes Annuity/maintenance licenses and Annuity license fee and excludes Perpetual licenses and Professional Services}

OVERVIEW

Market conditions remain challenging, as cautious customer outlooks continue to drive conservative spending behaviors. This continues to extend sales cycles for new software contracts, as customers are taking longer to advance purchasing decisions.

Against this backdrop, we have remained focused on positioning the company for long-term success, including moving decisively towards profitability with CoFlow, delivering speed-focused enhancements across our reservoir simulation software portfolio, and driving sales and growth alignment within our recently acquired companies.

We continue to build a robust process and discipline around our acquisition strategy. This quarter saw our highest level of activity to date in identifying and evaluating potential acquisitions, with advanced stage discussions underway.

Organic Recurring revenue declined in the quarter as the impact of the previously disclosed contract loss, which began in the second quarter, continued. This decline more than offset revenue growth from acquisitions.

Adjusted EBITDA and Free Cash Flow decreased during the quarter primarily due to the lower contribution from higher-margin reservoir and production solutions, as well as the ongoing expected decline in professional services revenue. Contributions from acquired businesses partially mitigated these impacts.

For the year-to-date period, acquisition growth continued to offset a significant portion of organic declines; however, overall Adjusted EBITDA and Free Cash Flow remain lower than the prior year, reflecting the cumulative effect of revenue mix changes and lower organic revenue.

Looking forward, Recurring revenue in the fourth quarter is expected to be higher than in the third quarter, reflecting the timing of seasonal contract renewals and revenue recognition. Organic Recurring revenue is expected to return to positive year-over-year growth in the fourth quarter.

While contract renewal and revenue recognition seasonality is expected to result in quarterly volatility, organic recurring revenue growth is expected to be positive on an annual basis in fiscal 2027. 

For the current fiscal year (excluding future acquisitions), Adjusted EBITDA is expected to be lower than the prior year due to the decline in organic revenue and professional services activity in the current fiscal year.

Q3 2026 Dividend

Computer Modelling Group’s Board approved a cash dividend of $0.01 per Common Share. The dividend will be paid on March 13, 2026, to shareholders of record at the close of business on March 5, 2026.

All dividends paid by Computer Modelling Group Ltd. to holders of Common Shares in the capital of the Company will be treated as eligible dividends within the meaning of such term in section 89(1) of the Income Tax Act (Canada), unless otherwise indicated.

SUMMARY OF FINANCIAL PERFORMANCE

_{⁽¹⁾ Non-IFRS financial measures are defined in the “Non-IFRS Financial Measures and Reconciliation of Non-IFRS Measures” section.
⁽²⁾ Total software revenue includes the amortization of a fair value reduction of deferred revenue recognized on acquisition, which has reduced post acquisition revenues by $0.1 million and $0.3 million respectively, for the three and nine months ended December 31, 2025 (three and nine months ended December 31, 2024 – nil and $0.2 million).}

NON-IFRS FINANCIAL MEASURES AND RECONCILIATION OF NON-IFRS MEASURES

Free Cash Flow Reconciliation to Funds Flow from Operations

Free Cash Flow is a non-IFRS financial measure that is calculated as funds flow from operations less capital expenditures and repayment of lease liabilities. Free Cash Flow per share is calculated by dividing Free Cash Flow by the number of weighted average outstanding shares during the period. Management believes that this measure provides useful supplemental information about operating performance and liquidity, as it represents cash generated during the period, regardless of the timing of collection of receivables and payment of payables, which may reduce comparability between periods. Management uses Free Cash Flow and Free Cash Flow per share to help measure the capacity of the Company to pay dividends and invest in business growth opportunities.