Yellow Pages (Y) Q2 2024 earnings summary

Executive summary

• Q2 2024 results showed improved revenue trends, solid profitability, and a strong cash position despite ongoing economic headwinds in the Canadian small business sector.

• Revenue fundamentals improved, with a 17% quarter-over-quarter increase in new account gains and stable customer churn.

• Adjusted EBITDA margin was 26.5%, reflecting continued investment in sales force expansion.

• Ended July with approximately CAD 34 million in cash, reflecting steady cash generation.

• Board declared a CAD 0.25 per share dividend, payable September 16, 2024.

Financial highlights

• Q2 2024 total revenues were CAD 25.5 million, down CAD 6.9 million or 11% year-over-year, with the rate of decline improving from the previous quarter.

• Digital revenues decreased 10.2% year-over-year to CAD 43.8 million, while print revenues fell 13.6% to CAD 12.1 million.

• Adjusted EBITDA was CAD 14.8 million (26.5% margin), down from CAD 21.9 million (35% margin) in Q2 2023.

• Net income for Q2 2024 was CAD 7.6 million, compared to CAD 12.7 million in Q2 2023.

• Cash flows from operating activities were CAD 13.7 million, down from CAD 20.0 million in Q2 2023.

Outlook and guidance

• Management remains confident in the medium- and long-term outlook, citing improved revenue metrics and ongoing strategic investments.

• Margin pressures are expected to continue due to revenue declines and ongoing investments in telesales capacity and IT.