Mr. Jeff Schellenberg reports

DECISIVE DIVIDEND CORPORATION REPORTS RECORD FINANCIAL RESULTS FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2023

Decisive Dividend Corp. has released its financial results for the three and nine months ended Sept. 30, 2023.

Highlights of the company's financial performance in third quarter 2023 include the following:

• Consolidated sales increased 45 per cent to a record $37.7-million in Q3 2023 compared with $25.9-million in Q3 2022.
• The quarterly sales increase brings consolidated sales for the first nine months of 2023 to $99.2-million, an increase of $31.4-million, or 46 per cent, relative to the first nine months of 2022.
• The company generated a record $7.9-million in adjusted earnings before interest, taxes, depreciation and amortization in Q3 2023, an increase of 97 per cent relative to Q3 2022.
• Adjusted EBITDA in the first nine months of 2023 of $18.0-million represents an 87-per-cent increase compared with the first nine months of 2022.
• The company generated a net profit of $2.7-million, or 15 cents per share, in Q3 2023, an increase of $700,000, or one cent lower per share compared with Q3 2022, in part as a result of the impact of foreign exchange gains in Q3 2022.
• In the first nine months of 2023, the company generated net profit of $5.9-million, or 35 cents per share, an increase of $2.5-million, or eight cents per share, compared with the first nine months of 2022.
• The per-share monthly dividend increased twice in 2023: first in March to 3.5 cents from 3.0 cents previously, and again in July to 4.0 cents. This represents an aggregate increase of 33 per cent in the annualized dividend.
• Balance sheet strength and flexibility: conservative leverage ratio of 1.5 times debt to adjusted EBITDA as of Sept. 30, 2023; ample liquidity as of the date of this press release with $17.7-million available on the revolving term acquisition facility and $5.3-million available on the revolving term operating facility, plus $3.6-million of cash.

Selected financial highlights

The following are selected financial highlights of Decisive Dividend for the three and nine months ended Sept. 30, 2023. The company's unaudited interim condensed consolidated financial statements, as well as its management's discussion and analysis, are posted on SEDAR+ and on Decisive Dividend's website.

Jeff Schellenberg, chief executive officer of Decisive Dividend, noted: "We are very pleased to see the record performance for Decisive across almost all metrics in Q3 2023. Q3 marks the ninth straight quarter where Decisive has had record-setting adjusted EBITDA and serves to illustrate the earnings potential of our current portfolio. As mentioned in [second quarter], the diversified nature of the portfolio of businesses, where demand and operational efficiency improvements in different businesses support the overall enhanced performance of the business, even in the face of some challenges, is very encouraging to see.

"The performance we saw from the three new businesses we added in April, 2023 (Capital I, Micon and Procore), as well as IHT, which was acquired in July, 2023, is extremely positive, as is the 15-per-cent organic growth seen in the five subsidiaries acquired prior to 2022. The gross margin expansion from 34 per cent in Q3 2022 to 43 per cent in Q3 2023 illustrates the major shift in profitability our business is experiencing as we benefit from the margin enhancement efforts of our existing subsidiaries along with the positive impact of the higher-margin subsidiaries we have recently acquired. All of these factors have contributed to material growth in our pro forma adjusted EBITDA for the trailing 12 months ended Sept. 30, 2023, to over $32-million, once the preacquisition periods of the newly acquired businesses are included, which is 46 per cent higher than our reported adjusted EBITDA. More importantly, increases in our per-share adjusted EBITDA and per-share free cash flow, which grew by 38 per cent and 46 per cent on a year-over-year basis compared with the first nine months of 2022, provide clear evidence of the steps being taken to drive value-creating growth.

"Finally, our pipeline of acquisition opportunities remains strong, and we are seeing the market soften as buyer expectations rebalance following several years of very buoyant valuations for sellers. We remain committed to continue pursuing opportunities to support the many legacy-minded exiting business owners who lack a succession plan and are looking for new ownership of their business that will preserve and build on the legacy they have created."

Outlook

Decisive Dividend remains focused on continuing to drive performance in line with its overall strategic objectives, including:

• Executing on the growth strategy, demonstrated by the acquisition of six businesses in a 15-month span;
• Building a strong and growing acquisition prospect pipeline;
• Assembling a diversified portfolio of high-quality, high-gross-margin product manufacturing businesses to support profitability growth even through periods of seasonality or lower demand in any individual business;
• Monitoring for indications of softening economic activity and its impact on demand for certain businesses, relative to what has been experienced over the past 12 months; even if concerns regarding a potential recession unfold, management believes the overall business is well positioned due to the strength of the industries in which Decisive Dividend's portfolio companies operate;
• Solidifying subsidiary leadership and developing an ecosystem of support for its subsidiaries at head office;
• Optimizing operations, with an emphasis on enhancing margins;
• Increasing production capacity and improving operational efficiency, with an aggregate $3.0-million of growth capital expenditures on manufacturing equipment made over the past 24 months and utilization of third party manufacturing partners;
• Providing sustainable and growing dividends to shareholders, with two increases of the monthly dividend in 2023, representing an aggregate increase of 33 per cent in the annualized dividend from 36 cents per share to 48 cents per share;
• Maintaining balance sheet flexibility with conservative leverage ratios and ample availability on the company's revolving term operating and acquisition facilities;
• Bolstering Decisive Dividend's resilience through a variety of economic conditions by aligning the business with supportive shareholders and lenders, and further diversifying the portfolio through acquisition and organic growth.

Conference call

Decisive Dividend will host a conference call for interested parties on Tuesday, Nov. 7, 2023, at 8 a.m. Pacific Time (11 a.m. Eastern Time), to discuss the company's Q3 2023 results. The call will be hosted by Mr. Schellenberg, and Rick Torriero, chief financial officer.

Details for those who wish to participate in this conference call are as follows.

Conference call details:  Tuesday, Nov. 7, 2023, at 8 a.m. Pacific Time/11 a.m. Eastern Time

Please call 10 minutes ahead of time.

Participant information

To join the conference call without operator assistance, you may register and enter your phone number to receive an instant automated callback.

You can also dial direct to be entered into the call by an operator.

Dial-in number -- North America (toll-free):  1-888-664-6392

Dial-in number -- United Kingdom (toll-free):  0-800-652-2435

Dial-in number -- international:  1-416-764-8659

Replay information (replay available until Nov. 14, 2023)

Replay number -- North America (toll-free):  1-888-390-0541

Replay number -- international:  1-416-764-8677

Replay access code:  483611 followed by the number sign

About Decisive Dividend Corp.

Decisive Dividend is an acquisition-oriented company, focused on opportunities in manufacturing. The company's purpose is to be the sought-out choice for exiting legacy-minded business owners while supporting the long-term success of the businesses acquired and, through that, creating sustainable and growing shareholder returns. The company uses a disciplined acquisition strategy to identify already profitable, well-established, high-quality manufacturing companies that have a sustainable competitive advantage, a focus on non-discretionary products, steady cash flows, growth potential and established, strong leadership.

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