■ Announcement · August 12, 2026
Computer Modelling Group Q1 2026 Results and Dividend Announcement
Computer Modelling Group reports Q1 2026 results, declares $0.01 dividend, and launches $20M share buyback.
First Quarter Financial Results
Computer Modelling Group Ltd. (CMG) reported its financial results for the three months ended June 30, 2026. Total revenue declined 6% compared to the same period last year. Recurring revenue fell 3%, as a 9% growth from acquisitions was offset by a 12% organic decline. The organic decline primarily reflects a previously disclosed customer loss incurred in the second quarter of fiscal 2026. This quarter marks the final period lapping that contract loss, after which year-over-year comparisons are expected to normalize.
Professional services revenue decreased 16%, with a 29% organic decline partially offset by 13% growth from acquisitions. The organic decline was driven by previously disclosed factors, including the absence of CoFlow related development funding that was recognized in the prior year, and the ongoing reduction in non-core professional services activity at Bluware.
Adjusted EBITDA and Free Cash Flow
Adjusted EBITDA for the quarter declined to $6.4 million, a result of lower revenue partially offset by disciplined cost management. Both acquisitions completed in fiscal 2026 (SeisWare and Rose & Associates) contributed positively to Adjusted EBITDA, despite the seasonal weighting of their software revenue recognition to the second half of the year.
Free Cash Flow declined to $3.5 million, impacted by lower revenue and higher income taxes, which had a negative impact on net income.
Outlook for Q2 and Fiscal 2027
In the second quarter, the company expects Recurring revenue to increase sequentially from Q1, driven by a higher renewal cycle in Q2 relative to Q1. Professional services revenue is expected to decline sequentially in Q2, representing the lowest quarter of the fiscal year, reflecting the completion of the wind down of non-core services at Bluware and lower activity levels during the summer months.
Adjusted EBITDA and Adjusted EBITDA margins in Q2 are expected to decline sequentially, reflecting the trough in professional services revenue and an expected increase in sales and marketing expense tied to agent commissions paid on contract renewals that happen regularly in Q2.
For fiscal 2027, the company updated its outlook for professional services revenue, which is now expected to decline between $6-7 million relative to fiscal 2026 (previously expected to be $6 million). Excluding the impact of future acquisitions, the company continues to expect organic Recurring revenue to be stable, no decline in Adjusted EBITDA, and improved Free Cash Flow.
Dividend and Share Buyback
On August 11, 2026, the Board of Directors approved a cash dividend of $0.01 per Common Share for the first quarter ended June 30, 2026. The dividend will be paid on September 15, 2026, to shareholders of record at the close of business on September 4, 2026. All dividends paid to holders of Common Shares will be treated as eligible dividends within the meaning of section 89(1) of the Income Tax Act (Canada), unless otherwise indicated.
Additionally, the Board approved a substantial issuer bid (SIB) under which the company will offer to repurchase for cancellation up to $20 million of its common shares at a price of not less than CAD $4.00 and not more than CAD $4.50 per share. The SIB is anticipated to commence on August 14, 2026, and expire on September 21, 2026, unless extended, varied or withdrawn.
What it means for income investors
The company maintains its quarterly dividend of $0.01 per share, providing a modest yield. The substantial issuer bid may support share price. However, revenue declines and lower free cash flow in the quarter could pressure future distributions.
Reporting based on: markets.businessinsider.com. Figures verified against market data where available.