D+H Announces Third Quarter 2015 Earnings and Addresses Misleading Short Seller Report

TORONTO, October 27, 2015 /CNW/ - DH Corporation (TSX:DH) ("D+H" or the
"Company"), a leading provider of technology solutions to domestic and
global financial institutions, today reported its financial results for
the three and nine months ended September 30, 2015.

"Our results for the third quarter were in line with our expectations
and we are pleased with the operational progress in all of our business
segments, demonstrating the strength of our solutions," said D+H Chief
Executive Officer Gerrard Schmid.  "During the quarter we saw continued
sales momentum in Global Transaction Banking Solutions and strong sales
results in our Lending & Integrated Core segment, which along with a
major contract win in our Collateral Management Solutions with the auto
finance division of a large Canadian bank, are building positive
organic growth and future revenues.  Also in the third quarter, we
announced the global rebranding of our recent Fundtech acquisition as
Global Transaction Banking Solutions (GTBS) within D+H."

Third Quarter 2015 Highlights 

The quarter results, in comparison to the prior year, include the first
full quarter inclusion of GTBS.

  • Revenues increased 44% to $415 million from $289 million in the same
    quarter in 2014. Adjusted revenues(1) totalled $419 million, an increase of $127 million, or 43%, over the
    same quarter in 2014.
  • Adjusted EBITDA(1) increased 38% to $127 million (30% margin) from $93 million (32%
    margin) compared to the same quarter in 2014.
  • Net income of $31 million ($0.29 per share, basic and diluted), compared
    to $32 million ($0.40 per share, basic and diluted) in the same quarter
    in 2014.
  • Adjusted net income(1) increased 29% to $65 million from $51 million in the same quarter in
    2014.
  • Adjusted net income per share(1) of $0.62 compares to $0.63 in the same quarter in 2014.
  • Total equity increased to $2.3 billion (shares outstanding = 106.1
    million) at September 30, 2015 from $1.4 billion (shares outstanding =
    86.4 million) at December 31, 2014.
  • Loans, borrowings, and convertible debentures increased to $2.0 billion at September 30, 2015 from $1.0 billion at December 31, 2014.
  • The net debt to EBITDA(1) ratio was 3.44 at September 30, 2015 as compared to 3.45 at April 30,
    2015
    (Fundtech acquisition closing) and 2.11 at December 31, 2014. A
    debt repayment of $20 million was made in the third quarter, which was
    offset by an FX impact on USD debt.
  • Enterprise value(4) totalled $6.2 billion at September 30, 2015 and $3.9 billion at
    September 30, 2014.

Third Quarter and Year to Date 2015 Results

The selected financial information included in this press release is
qualified in its entirety by, and should be read together with, the
unaudited condensed interim consolidated financial statements for the
three and nine months ended September 30, 2015, and the MD&A for the
three and nine months ended September 30, 2015, which can be found at
dh.com and in the disclosure documents filed by the Company with the
securities regulatory authorities at sedar.com.

Note regarding reporting segments, as referenced in Q2, 2015:

  • The acquisition of Fundtech is reported as a segment called Global
    Transaction Banking Solutions ("GTBS") Segment.
  • The D+H U.S. segment has been renamed and is now reported as the Lending
    & Integrated Core ("L&IC") Segment.
Selected Consolidated Financial Information

(C$ millions unless otherwise indicated, unaudited)
Three months ended

September 30
Nine months ended

September 30
2015 2014 2015 2014
Revenues $415.1 $289.2 $1,082.5 $841.5
Adjusted revenues1 $418.8 $292.0 $1,090.5 $859.9
EBITDA1 $127.5 $88.5 $307.9 $245.3
Adjusted EBITDA1 $127.4 $92.6 $324.5 $264.3
Adjusted EBITDA margin1 30% 32% 30% 31%
Net income $30.7 $32.2 $70.7 $74.1
Adjusted net income1 $65.2 $50.6 $172.2 $140.9
Net income per share, basic and diluted (C$) $0.29 $0.40 $0.73 $0.92
Adjusted net income per share, basic and diluted1 $0.62 $0.63 $1.77 $1.74
Net cash from operating activities $64.7 $43.3 $128.4 $108.4
Revenues by Segment and

Service Area2, 3

(C$ millions, unaudited)
Canadian L&IC GTBS Consolidated
2015 2014 2015 2014 2015 2014 2015 2014
Three months ended September 30
Lending solutions $94.3 $92.4 $80.9 $63.2 - n/a $175.3 $155.5
Payments solutions $82.3 $76.4 - - - n/a $82.3 $76.4
Integrated core solutions - - $69.7 $57.2 - n/a $69.7 $57.2
GTBS - - - - $87.9 n/a $87.95 n/a
Total Revenues $176.6 $168.8 $150.6 $120.4 $87.9 n/a $415.1 $289.2
Nine months ended September 305
Lending solutions $273.9 $260.3 $231.5 $185.3 - n/a $505.4 $445.6
Payments solutions $237.4 $227.4 - - - n/a $237.4 $227.4
Integrated core solutions - - $196.7 $168.4 - n/a $196.7 $168.4
GTBS - - - - $143.05 n/a $143.05 n/a
Total Revenues $511.3 $487.7 $428.2 $353.8 $143.0 n/a $1,082.5 $841.5
Adjusted revenues1 by Segment

and Service Area2,3

(C$ millions, unaudited)
Canadian L&IC GTBS Consolidated
2015 2014 2015 2014 2015 2014 2015 2014
Three months ended September 30
Lending solutions $94.3 $92.4 $82.0 $65.7 - n/a $176.3 $158.1
Payments solutions $82.3 $76.4 - - - n/a $82.3 $76.4
Integrated core solutions - - $69.8 $57.5 - n/a $69.8 $57.5
GTBS - - - - $90.4 n/a $90.4 n/a
Total Adjusted revenues1 $176.6 $168.8 $151.8 $123.2 $90.4 n/a $418.8 $292.0
Nine months ended September 305
Lending solutions $273.9 $260.3 $235.1 $201.8 - n/a $509.0 $462.1
Payments solutions $237.4 $227.4 - - - n/a $237.4 $227.4
Integrated core solutions - - $197.2 $170.5 - n/a $197.2 $170.5
GTBS - - - - $146.95 n/a $146.95 n/a
Total Adjusted revenues1 $511.3 $487.7 $432.2 $372.2 $146.9 n/a $1,090.5 $859.9
Operations by Segment and Corporate

(C$ millions, unaudited)
Canadian L&IC GTBS Corporate Consolidated
2015 2014 2015 2014 2015 2014 2015 2014 2015 2014
Three months ended September 30
Revenues $176.6 $168.8 $150.6 $120.4 $87.9 n/a - - $415.1 $289.2
Expenses $129.4 $120.2 $90.1 $76.9 $69.0 n/a ($1.0) $3.7 $287.5 $200.8
EBITDA1 $47.2 $48.7 $60.5 $43.5 $18.8 n/a $1.0 ($3.7) $127.5 $88.5
EBITDA Margin1 27% 29% 40% 36% 21% n/a - - 31% 31%
Adjusted revenues1 $176.6 $168.8 $151.8 $123.2 $90.4 n/a - - $418.8 $292.0
Adjusted EBITDA1 $47.2 $48.9 $59.6 $43.9 $20.7 n/a - - $127.4 $92.6
Adjusted EBITDA

margin1
27% 29% 39% 36% 23% n/a - - 30% 32%
Nine months ended September 305
Revenues $511.3 $487.7 $428.2 $353.8 $143.0 n/a - - $1,082.5 $841.5
Expenses $371.8 $356.3 $273.4 $230.9 $112.9 n/a $16.6 $9.0 $774.6 $569.2
EBITDA1 $139.5 $131.4 $154.8 $122.9 $30.1 n/a ($16.6) ($9.0) $307.9 $245.3
EBITDA Margin1 27% 27% 36% 35% 21% n/a - - 28% 29%
Adjusted revenues1 $511.3 $487.7 $432.2 $372.2 $146.9 n/a - -

-
$1,090.5 $859.9
Adjusted EBITDA1 $139.5 $131.4 $152.1 $132.9 $32.9 n/a - - $324.5 $264.3
Adjusted EBITDA margin1 27% 27% 35% 36% 22% n/a - - 30% 31%
Revenues, Adjusted revenues and Adjusted EBITDA by

Segment in US$

(US$ millions, unaudited)
Three months ended

September 30
Nine months ended

September 30
2015 2014 2015 2014
L&IC Segment revenues2,3
Lending solutions $61.7 $57.9 $183.6 $169.3
Integrated core solutions $53.2 $52.6 $156.1 $153.9
Total L&IC Segment revenues $115.0 $110.5 $339.6 $323.2
L&IC Segment Adjusted revenues1,2,3
Lending solutions $62.6 $60.3 $186.4 $184.3
Integrated core solutions $53.3 $52.8 $156.4 $155.8
Total L&IC Segment Adjusted revenues $115.9 $113.1 $342.8 $340.1
L&IC Segment Adjusted EBITDA1 $45.4 $40.3 $120.3 $121.5
L&IC Segment Adjusted EBITDA margin1 39% 36% 35% 36%
         
GTBS Segment revenues $67.0 n/a $111.95 n/a
GTBS Segment Adjusted revenues1 $68.9 n/a $115.05 n/a
GTBS Segment Adjusted EBITDA1 $15.7 n/a $25.75 n/a
GTBS Segment Adjusted EBITDA margin1 23% n/a 22%5 n/a
Enterprise Value4 and Outstanding Shares

(Enterprise value in C$, unaudited; shares in millions)
September 30, 2015 September 30, 2014
Enterprise Value4 $6.2B $3.9B
Outstanding Shares 106.1 80.8
Three Months Ended September 30, 2015 September 30, 2014
Weighted Average Shares Outstanding 105.9 80.8
1 Non-IFRS measure.  See the "Use of Non-IFRS Financial Information"
section of this press release

for further details.
2 Totals may not sum due to rounding.
3 Effective October 1, 2014, revenues reported as 'lending solutions'
comprise of 'lending processing

solutions' and 'banking technology solutions - lending' as reported in
prior periods. Revenues

reported as 'Integrated Core Solutions' comprise of 'banking technology
solutions - enterprise'

as reported in prior periods.
4 Non-IFRS measure.
5 Reported results for GTBS begin as of closing of the Fundtech
acquisition on April 30, 2015 and

include the period from May 1, 2015 through September 30, 2015

D+H Addresses Misleading Short Seller Report



The Company also announced that it has become aware of a report issued
by a hedge fund which the Company believes to be engaged in short
selling of its shares and which includes numerous assertions regarding
the Company's growth prospects and past performance, including that of
its GTBS Segment.



This report contains numerous inaccurate, unsubstantiated and misleading
statements, assertions and speculations. D+H recommends that investors
review its public filings as providing accurate information regarding
the Company and its performance, and not to rely on this report which
contains misrepresentations and which may have purposes other than
giving investors accurate information and impartial analysis. D+H
intends to vigorously defend itself against these false assertions and
self-interested attacks.

Dividend Reinvestment Plan

On January 14, 2015, the Company announced the adoption of a Dividend
Reinvestment Plan which became effective in the first quarter of 2015.
The Dividend Reinvestment Plan participation rate for the third quarter
of 2015 was approximately 29% of outstanding D+H shares. The dividend
declared by D+H in the third quarter of 2015, as described in the
"Dividend" section of this press release below, will also be eligible
for the Dividend Reinvestment Plan.

At this time, the Company intends to have these common shares issued
from treasury at a 4% discount to the weighted average trading price of
the common shares on the TSX during the five trading days immediately
preceding the dividend payment date. The 4% discount will remain in
effect for all cash dividends that may be declared, if any, by the
Company's Board of Directors until otherwise announced. To participate
in the Dividend Reinvestment Plan, eligible shareholders should refer
to plan information on the D+H website at dh.com.  Eligible
shareholders who have not previously registered must register on or
before December 17, 2015, the dividend record date, to participate in
the program for the dividend payable on December 31, 2015.

SUBSEQUENT EVENTS

Dividend

DH Corporation today announced that its Board of Directors has declared
a quarterly dividend of $0.32 per common share payable on December 31,
2015
to shareholders of record at the close of business on December 17,
2015
. The dividend is an eligible dividend for Canadian income tax
purposes.

OUTLOOK

For further information on trends, management's outlook and corporate
priorities in 2015, please refer to section 3 of the MD&A for the three
months and nine months ended September 30, 2015.

MANAGEMENT CONFERENCE CALL AND WEBCAST

Teleconference:

A conference call to review these financial results, including a
presentation, will take place at 9:00 a.m. (EST) on Tuesday, October
27, 2015
hosted by Chief Executive Officer Gerrard Schmid and Chief
Financial Officer Karen H. Weaver. To access the call, please dial
647-427-7450 (Local/Int'l) or 1-888-231-8191 (toll-free within North
America
).  A replay of the call will also be available until November
11, 2015
by dialing 416-849-0833 (Local/Int'l) or 1-855-859-2056
(toll-free within North America), with Encore Password 52108349.

Webcast:

The conference call will also be webcast at http://event.on24.com/r.htm?e=1060132&s=1&k=762A8E2E6683040C36E42F9903CAA7FB
and will be archived for 90 days after the call. The link to the webcast
and an accompanying slide presentation will be posted in the Investors
section of the D+H website under Events and Presentations at http://www.dh.com/investors/events-and-presentations/conference-calls.

ABOUT D+H

D+H (TSX: DH) is a leading financial technology provider the world's
financial institutions rely on every day to help them grow and succeed.
Our lending, payments, integrated core and global transaction banking
solutions are trusted by nearly 8,000 banks, specialty lenders,
community banks, credit unions, governments and corporations.
Headquartered in Toronto, Canada, D+H has more than 5,500 employees
worldwide who are passionate about partnering with clients to create
forward-thinking solutions that fit their needs. With annual revenues
well in excess of $1 billion, D+H is recognized as one of the world's
top FinTech companies on IDC Financial Insights FinTech Rankings and American Banker's FinTech Forward rankings. For more information, visit dh.com

USE OF NON-IFRS FINANCIAL INFORMATION

D+H's financial results are prepared in accordance with International
Financial Reporting Standards ("IFRS").  D+H reports several non-IFRS
financial measures, including Adjusted revenues, EBITDA, EBITDA margin,
Adjusted EBITDA, Adjusted EBITDA margin, Adjusted net income, Adjusted
net income per share, and Debt to EBITDA ratio.  See "Non-IFRS
financial measures and key performance indicators" in D+H's MD&A for
the three and nine months ended September 30, 2015 for a more complete
description of these terms and for reconciliations to their most
directly comparable IFRS measures, where applicable. Any non-IFRS
financial measures should be considered in context with the IFRS
financial statement presentation and should not be considered in
isolation or as a substitute for IFRS revenues, net income or cash
flows. Furthermore, D+H's financial measures may be calculated
differently from similarly titled financial measures of other
companies.

CAUTION CONCERNING FORWARD-LOOKING STATEMENTS

This press release contains certain statements that constitute
forward-looking information within the meaning of applicable securities
laws ("forward-looking statements"). Statements concerning D+H's
objectives, goals, strategies, priorities, intentions, plans, beliefs,
expectations and estimates, and the business, operations, financial
performance and condition of D+H are forward-looking statements. The
words "believe", "expect", "anticipate", "estimate", "intend", "may",
"will", "would", "could", "should", "continue", "goal", "objective",
and similar expressions and the negative of such expressions are
intended to identify forward-looking statements, although not all
forward-looking statements contain these identifying words.

Risks related to forward-looking statements include, among other things,
increased pricing pressures and competition which could lead to loss of
contracts or reduced margins; the Company's ability to deliver products
and services in line with the changes in the United States of America
("U.S.") and Canadian banking and financial services industry; the
Company's ability to avoid inherent risks in the technology industry
related to cyber-security threats and breaches; the Company's
dependence on a limited number of large financial institution customers
in Canada and dependence on their acceptance of new programs;  declines
in the use of personal and business cheques; strategic initiatives
being undertaken to grow our business and increase profitability;
stability and growth in the real estate, mortgage and other lending
markets; the Company's ability to generate cash to invest in the
business and at the same time be able to pay dividends and debt
repayments; as well as general market conditions, including economic,
foreign exchange and interest rate dynamics.  Risks related to forward
looking statements also include the ability of the Corporation to
achieve the expected benefits of the acquisition of Fundtech, including
(i) further broadening and diversifying the Corporation's client base
and operational capabilities; (ii) accelerating the Corporation's
global expansion strategy with meaningful exposure to markets outside
North America; (iii) diversifying the Corporation's business in terms
of product offerings; (iv) broadening the Corporation's sources of
long-term recurring revenues; (v) benefits from an accretion and cash
flow perspective (each of which may be impacted by the realization and
timing of any potential synergies and the operating performance of the
Corporation and the GTBS segment); (vi) enhanced revenue generation
through cross-selling opportunities; and (vii) high free cash flow
conversion rate, which the Corporation expects will enable, along with
the Company's Canadian and Lending and Integrated Core operating cash
flows, deleveraging, support dividend payments and fund investment for
future growth.

Given these uncertainties, readers are cautioned not to place undue
reliance on such forward-looking statements. The documents referred to
herein also identify additional factors that could affect the operating
results and performance of the Company. Forward-looking statements are
based on management's current plans, estimates, projections, beliefs
and opinions, and D+H does not undertake any obligation to update
forward-looking statements should assumptions related to these plans,
estimates, projections, beliefs and opinions change except as required
by applicable securities laws.

D+H has also made certain macroeconomic and general industry assumptions
in the preparation of such forward-looking statements. While D+H
considers these factors and assumptions to be reasonable based on
information currently available, there can be no assurance that actual
results will be consistent with these forward-looking statements.

Forward-looking statements involve known and unknown risks,
uncertainties and other factors that may cause D+H's actual results,
performance or achievements, or developments in its industry, to differ
materially from the anticipated results, performance, achievements or
developments expressed or implied by such forward-looking statements.

All of the forward-looking statements made in this press release are
qualified by these cautionary statements and other cautionary
statements or factors contained herein and there can be no assurance
that the actual results or developments will be realized or, even if
substantially realized, that they will have the expected consequences
to, or effects on, the Company.

REGULATORY FILINGS AND ADDITIONAL INFORMATION

DH Corporation is listed on the Toronto Stock Exchange under the symbol
DH. Further information can be found at dh.com and in the disclosure documents filed by DH Corporation with the
securities regulatory authorities at sedar.com

SOURCE DH Corporation