Vancouver, British Columbia--(Newsfile Corp. - August 6, 2026) - Dominion Lending Centres Inc. (TSX: DLCG) (the "DLC Group" or the "Corporation") today announced financial results for the three ("Q2 2026") and six months ended June 30, 2026. The DLC Group is one of Canada's leading franchisors of mortgage professionals, with a national network of over 8,800 agents. The Corporation also owns Velocity and Filogix, fintech mortgage connectivity products that provide integrated end-to-end operating platforms designed to automate and streamline the entire mortgage application, approval, underwriting and funding process.

Financial Highlights for Q2 2026:

• Funded mortgage volumes of $22.1 billion in Q2 2026 increased 5% compared to Q2 2025 driven by higher broker productivity.
• Revenue grew 1% year-over-year in the second quarter of 2026 to $24.9 million.
• Adjusted EBITDA of $12.6 million was consistent with the same period last year. Adjusted EBITDA margins remained strong at 50%, compared to 51% in the prior-year period. Adjusted EBITDA includes a loss from our equity-accounted investment in Heartwood of $0.5 million for Q2 2026 and $0.6 million for Q2 2025.
• Net income in Q2 2026 of $7.1 million compared to $7.7 million in Q2 2025 as strong profitability was offset by a $0.6 million increase in share-based payments expense. Adjusted net income and adjusted earnings per share in Q2 2026 were $7.1 million and $0.09, compared to $7.8 million and $0.10 in Q2 2025.
• A quarterly dividend of $0.05 per share was paid on June 15, 2026, a 25% increase compared to prior year.
• Subsequent to quarter end, the DLC Group acquired Filogix, a leading Canadian mortgage connectivity platform for $58.5 million in cash, subject to closing adjustments. The acquisition is expected to be immediately accretive to Adjusted EPS.

"We successfully grew our funded mortgage volumes by 5% in the second quarter, despite a soft housing market, reflecting increased productivity of our brokers," said Gary Mauris, Co-Founder and CEO of the DLC Group. "While recruiting has been a cornerstone of our strategy over the past 20 years, in recent years we have increasingly invested in helping our existing brokers grow their businesses through initiatives such as Gold Rush, Goal Getter and, most recently, Broker Performance Lab. A key enabler of these initiatives has been Velocity, which is now broadly adopted across our network and continues to provide brokers with the technology and insights to enhance productivity and better service their customers. We look forward to continuing to invest in our brokers and supporting their long-term success," continued Mr Mauris.

"We also continued to deliver strong profitability, generating Adjusted EBITDA margins of 50% in the second quarter, strong free cash flow and further strengthening our balance sheet. We exited the quarter with Net Debt to Adjusted EBITDA of 0.89x. It was the strength of our balance sheet that enabled us to fund and complete the highly strategic and accretive acquisition of Filogix post quarter end. Over the past three decades, Filogix has established itself as one of the leaders in the mortgage broker connectivity market. We look forward to further strengthening the Filogix business through continued investment in its platform, leveraging its capabilities to help broker customers grow, enhancing service to lenders and suppliers and creating long-term value for our shareholders," concluded Mr. Mauris.

Second Quarter 2026 Financial Summary

(1) Please see the Non-IFRS Financial Performance Measures section of this document for additional information.
(2) Adjusted EBITDA and Adjusted EBITDA margin includes a loss from our equity-accounted investment in Heartwood of $0.5 million and $0.8 million for the three and six months ended June 30, 2026, respectively (June 30, 2025 - $0.6 million and $0.9 million).

Key Performance Indicators ("KPIs")

(1) Funded mortgage volumes are presented in billions and are a key performance indicator that allows us to measure performance against our operating strategy.
(2) The number of franchises and brokers are as at the respective period end date (not in thousands).
(3) Representing the percentage of the DLC Group's funded mortgage volumes that were submitted through Velocity.

Second Quarter 2026 Financial Review
The DLC Group delivered stable second quarter results with 5% growth in funded mortgage volumes, strong Adjusted EBITDA margins of 50% and solid free cash flow.

• Funded mortgage volume increased 5% in the quarter driven by higher broker productivity. Total revenue increased 1% year-over-year to $24.9 million, reflecting 4% growth in Franchise and Brokering of Mortgages revenue, partially offset by a 4% decline in Newton revenue. The decline in Newton revenue was due primarily to revenue reclassification recorded in Q2 2025, which included $0.3 million revenue related to Q1 2025. Growth in Franchise and Brokering of Mortgages revenue was also impacted by $0.3 million higher amortization of franchise rights payments, which are recognized over time and do not move in line with funded volume.
• Direct costs decreased 8% over Q2 2025 primarily from lower cost of royalty revenue reflecting the cost savings following the realignment of our sales team structure in Q4 2025, which was partly offset by an increase in costs related to monthly fee revenue. On a percent-of-revenue basis, direct costs declined to 11.9% in Q2 2026 from 13.1% in Q2 2025.
• General and administrative expenses increased 5%, or $0.4 million, compared to Q2 2025. The increase was driven primarily by $0.3 million in higher personnel and IT-related costs and was partly offset by a $0.2 million reduction in advertising expenses due to timing of events. The Company is currently undergoing an expense review to identify potential cost savings. On a percent-of-revenue basis, general and administrative expenses increased to 36.4% from 35.2% in Q2 2025.
• Adjusted EBITDA of $12.6 million was consistent with Q2 2025, while Adjusted EBITDA margin remained strong at 50%, compared to 51% in the prior-year period. Adjusted EBITDA includes a loss from the Company's equity-accounted investment in Heartwood of $0.5 million for the three months ended June 30, 2026, compared to $0.6 million in the prior-year period.
• Net income of $7.1 million decreased by $0.6 million compared to Q2 2025 due primarily to a $0.6 million increase in share-based payments expense and higher general and administrative expenses. The increase in share-based payments expense reflects additional RSU grants under the RSU Plan and the impact of graded vesting on previously issued awards.
• Adjusted diluted earnings per common share was $0.09 in Q2 2026, compared to $0.10 in Q2 2025. Adjusted net income of $7.1 million decreased by $0.6 million compared to Q2 2025, as higher revenue was more than offset by increased share-based payments expense as explained above.
• Cash flow from operating activities increased 13% to $12.2 million compared to Q2 2025, primarily due to a $1.2 million favourable change in non-cash working capital, largely driven by the timing of accounts receivable collections.
• Free cash flow attributable to common shareholders was $10.2 million, compared to $10.6 million in Q2 2025, as cash flow from operations, adjusted for non-cash working capital fluctuations, was more than offset by higher maintenance capital expenditures related to franchise renewal payments.
• The Corporation ended the quarter with adjusted total debt-to-EBITDA (on a trailing twelve-month basis) of 0.89x compared to 0.51x at the same period last year.
• On March 24 2026, the Corporation announced an increase to its quarterly dividend from $0.04 per common share to $0.05 per common share. The first quarterly dividend of $0.05 per common share was paid on June 15, 2026 to common shareholders of record on June 1, 2026.

2026 Year-to-Date Financial Review (Six Months)
The DLC Group delivered stable year-to-date results for the six months ended June 30, 2026, with increased revenues compared to the same period in 2025 and continued strong Adjusted EBITDA margins. Funded mortgage volumes remained consistent in the first quarter of 2026 against a strong prior-year comparable and increased 5% year-over-year in the second quarter of 2026, despite a weak residential housing market.

• Revenue increased 4% to $44.9 million for the six months ended June 30, 2026, supported by a 3% increase in funded mortgage volumes and continued growth in Velocity adoption, which increased to 86% from 81% in 2025. Revenue from Franchise and Brokering of Mortgages increased 3% year over year, while Newton revenue increased 5%.
• Direct costs decreased 15% compared to the same period in 2025, primarily due to cost savings following the Q4 2025 realignment of the Corporation's sales team structure, and lower advertising fund expenditures due to the timing of advertising initiatives. As a percentage of revenue, direct costs declined to 10.1% in 2026 from 12.3% in 2025.
• General and administrative expenses increased 9%, or $1.6 million, compared to the same period in 2025, primarily due to $0.9 million in higher personnel, IT-related costs, and approximately $0.4 million of first-quarter advertising expenses related to the Corporation's 20th anniversary marketing initiatives. Higher personnel costs reflected increased headcount, wage inflation, and higher EBITDA-based executive incentive compensation. As a percentage of revenue, general and administrative expenses increased to 42.0% from 39.8% in 2025.
• Adjusted EBITDA increased 3% to $21.3 million compared to the six months ended June 30, 2025, reflecting revenue growth and lower direct costs, partially offset by higher general and administrative expenses. Adjusted EBITDA margin remained strong at 47%, compared to 48% in the prior-year period. Adjusted EBITDA includes a loss from the Corporation's equity-accounted investment in Heartwood of $0.8 million for the six months ended June 30, 2026, compared to a loss of $0.9 million for the same period in 2025.
• Net income of $11.9 million decreased by $2.1 million compared to the six months ended June 30, 2025, primarily due to a $1.4 million gain on disposal of an equity-accounted investee recognized in the prior-year period that did not recur in 2026, and a $0.9 million increase in share-based payments expense. The increase in share-based payments expense reflects additional RSU grants under the RSU Plan and the impact of graded vesting on previously issued awards.
• Adjusted diluted earnings per common share was $0.15 in 2026, compared to $0.16 in the same period in 2025. Adjusted net income decreased to $12.1 million from $12.7 million in 2025, as higher revenues were more than offset by higher general and administrative expenses and increased share-based payments expense as explained above.
• Cash flow from operating activities decreased 7% to $17.2 million compared to the same period in 2025, primarily reflecting a change in non-cash working capital due to the timing of commissions payable.
• Free cash flow attributable to common shareholders was $17.0 million, compared to $17.4 million in 2025, as cash flow from operations, adjusted for non-cash working capital fluctuations, was more than offset by higher maintenance capital expenditures related to franchise renewal payments.

Conference Call & Webcast
The Corporation will hold a conference call at 4:00pm Mountain Time (6:00pm Eastern Time) on Thursday, August 6, 2026 to discuss these results. To participate in the conference call, please dial 1-800-715-9871 or 1-647-932-3411 (International) at least 5 minutes prior to the call.

This conference call will also be webcast live and can be accessed by all interested parties at the following URL:
https://www.gowebcasting.com/14761.

A webcast replay will also be available within 24 hours following the call on The DLC Group's website at www.dlcg.ca, in the Investors section.

Reconciliation of Non-IFRS Financial Measures
Management presents certain non-IFRS financial performance measures which we use as supplemental indicators of our operating performance. These non-IFRS measures do not have any standardized meaning and therefore are unlikely to be comparable to the calculation of similar measures used by other companies and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with IFRS Accounting Standards. Non-IFRS measures are defined and reconciled to the most directly comparable IFRS Accounting Standards measure. Non-IFRS financial performance measures include adjusted EBITDA, adjusted net income, adjusted earnings per share, and free cash flow. Please see the Non-IFRS Financial Performance Measures section of the Corporation's MD&A dated August 6, 2026 for further information on key performance indicators. The Corporation's MD&A is available on SEDAR+ at www.sedarplus.ca.

ADJUSTED EBITDA
Adjusted EBITDA is defined as earnings before finance expense, taxes, depreciation, amortization, and any unusual, non-operating, certain non-cash, or one-time items. The Corporation considers its main operating activities to be the business of mortgage brokerage franchising and mortgage broker data connectivity services across Canada, and management of its operating subsidiaries. Adjusted EBITDA margin is defined as adjusted EBITDA divided by revenue.

The non-cash adjustments are expenses incurred during the period which are not the result of the main operating activities of the Corporation or are related to the financing of these activities. Other expenses are unusual, non-cash, or one-time insignificant items included within "other (expense) income" on the consolidated statements of income that are not related to the main operating activities.

While adjusted EBITDA is not a recognized measure under IFRS Accounting Standards, management believes that it is a useful supplemental measure as it provides management and investors with an insightful indication of the performance of the Corporation. Adjusted EBITDA is an assessment of its normalized results and cash generated by its main operating activities, prior to the consideration of how these activities are financed or taxed, as a facilitator for valuation and a proxy for cashflow. Management applies adjusted EBITDA in its operational decision making as an indication of the financial performance of its main operating activities.

Investors should be cautioned, however, that adjusted EBITDA should not be construed as an alternative to a statement of cash flows as a measure of liquidity and cash flows. The methodologies we use to determine adjusted EBITDA may differ from those utilized by other issuers or companies and, accordingly, adjusted EBITDA as used in this document may not be comparable to similar measures used by other issuers or companies. Readers are cautioned that adjusted EBITDA should not be construed as an alternative to net income determined in accordance with IFRS Accounting Standards as an indicator of an issuer's performance or to cash flows from operating, investing, and financing activities as measures of liquidity and cash flows.

The following table reconciles adjusted EBITDA from income before income tax, which is the most directly-comparable measure calculated in accordance with IFRS Accounting Standards:

(1) Other expense for the three and six months ended June 30, 2026 relates to a loss on disposal of an intangible asset. Other expense for the three and six months ended June 30, 2025 relates to a foreign exchange loss and a loss on contract settlement.
(2) Amortization of franchise rights and relationships of $1.6 million and $3.0 million for the three and six months ended June 30, 2026, respectively (June 30, 2025 - $1.3 million and $2.6 million) is classified as a charge against revenue and has not been added back for adjusted EBITDA.

FREE CASH FLOW

Free cash flow represents how much cash a business generates after spending what is required to maintain or expand its current asset base. Free cash flow attributable to common shareholders represents the cash available to the Corporation for general corporate purposes, including: repayments on our credit facilities, investment in growth capital expenditures, return of capital to common shareholders through the repurchases of Common Shares and discretionary payment of dividends to common shareholders, and cash to be retained by the company. This is a useful measure that allows management and users to understand the cash available to enhance shareholder value.

The other adjustments are expenses incurred during the period which are not the result of the main operating activities of the Corporation, or are related to the financing of these activities. Other one-time items included within other expense adjustments are insignificant items included within "other (expense) income" on the condensed consolidated statements of income that are not related to the main operating activities.

While free cash flow is not a recognized measure under IFRS Accounting Standards, management believes that it is a useful supplemental measure as it provides management and investors with an insightful indication of the funds generated by the main operating activities that are available to the Corporation for use in non-operating activities. Free cash flow is determined by adjusting certain investing and financing activities. Investors should be cautioned, however, that free cash flow should not be construed as an alternative to a statement of cash flows as a measure of liquidity and cash flows. The methodologies we use to determine free cash flow may differ from those utilized by other issuers or companies and, accordingly, free cash flow as used in this document may not be comparable to similar measures used by other issuers or companies. Readers are cautioned that free cash flow should not be construed as an alternative to net income determined in accordance with IFRS Accounting Standards as indicators of an issuer's performance, or to cash flows from operating, investing, and financing activities as measures of liquidity and cash flows.

The following table reconciles free cash flow from cash flow from operating activities, which is the most directly-comparable measure calculated in accordance with IFRS Accounting Standards:

(1) Other non-cash items for the three and six months ended June 30, 2026 relates to a loss on disposal of an intangible asset. The three and six months ended June 30, 2025 represents a foreign exchange loss and promissory note income.

ADJUSTED NET INCOME AND ADJUSTED EPS
Adjusted net income and Adjusted EPS are defined as net income before any unusual or non-operating items such as foreign exchange, fair value adjustments, and one-time non-recurring items. Other one-time items included within other expense adjustments are insignificant items included within "other (expense) income" on the condensed consolidated statements of income that are not related to the main operating activities.

While adjusted net income is not a recognized measure under IFRS Accounting Standards, management believes that it is a useful supplemental measure as it provides management and investors with an insightful indication of the operational performance of the Corporation by eliminating certain non-recurring items. Management applies adjusted net income in its operational decision making as an indication of the results and cash generated by the main operating activities, after consideration of how these activities are financed and taxed. Adjusted net income is used to determine adjusted EPS (defined as adjusted net income attributable to common shareholders on a per-share basis).

Investors should be cautioned, however, that adjusted net income should not be construed as an alternative to net income determined in accordance with IFRS Accounting Standards as an indicator of an issuer's performance or to cash flows from operating, investing, and financing activities as a measure of liquidity and cash flows. The methodologies we use to determine adjusted net income may differ from those utilized by other issuers or companies and, accordingly, adjusted net income as used in this document may not be comparable to similar measures used by other issuers or companies.

The following table reconciles adjusted net income from net income, which is the most directly-comparable measure calculated in accordance with IFRS Accounting Standards:

(1) Other expense for the three and six months ended June 30, 2026 relates to a loss on disposal of an intangible asset. Other expense for the three and six months ended June 30, 2025 relates to a foreign exchange loss and a loss on contract settlement.

Forward-Looking Information
Certain statements in this document constitute forward-looking information under applicable securities legislation. Forward-looking information typically contains statements with words such as "anticipate," "believe," "estimate," "will," "expect," "plan," or similar words suggesting future outcomes or outlooks. Forward-looking information in this document includes, but is not limited to, our continued investment in helping our existing brokers grow their businesses through initiatives such as Gold Rush, Goal Getter and, most recently, Broker Performance Lab, and that these programs together with Velocity will continue to provide brokers with the technology and insights to enhance productivity and better service their customers, and that we are able to further strengthen the Filogix business through continued investment in its platform, leveraging its capabilities to help broker customers grow, enhancing service to lenders and suppliers and creating long-term value for our shareholders.

Such forward-looking information is based on many estimates and assumptions, including material estimates and assumptions, related to the following factors below that, while considered reasonable by the Corporation as at the date of this press release considering management's experience and perception of current conditions and expected developments, are inherently subject to significant business, economic, and competitive uncertainties and contingencies. Known and unknown factors could cause actual results to differ materially from those projected in the forward-looking statements. Such factors include, but are not limited to:

• Changes in interest rates;
• The DLC Group's ability to maintain its existing number of franchisees and brokers, and to add additional franchisees and brokers;
• Changes in overall demand for Canadian real estate (via factors such as immigration);
• Changes in overall supply for Canadian real estate (via factors such as new housing-start levels);
• At what period in time the Canadian real estate market stabilizes;
• Changes in Canadian mortgage lending and mortgage brokerage laws and regulations;
• Changes in the Canadian mortgage lending marketplace;
• Changes in the fees paid for mortgage brokerage services in Canada; and
• Demand for the Corporation's products remaining consistent with historical demand.

Many of these uncertainties and contingencies may affect our actual results and could cause actual results to differ materially from those expressed or implied in any forward-looking statements made by, or on behalf of, us. Readers are cautioned that forward-looking statements are not guarantees of future performance. All forward-looking statements made in this document are qualified by these cautionary statements. The foregoing list of risks is not exhaustive. The forward-looking information contained in this document is made as of the date hereof and, except as required by applicable securities laws, we undertake no obligation to update publicly or revise any forward-looking statements or information, whether because of new information, future events or otherwise.

About Dominion Lending Centres Inc.
Dominion Lending Centres Inc. is Canada's leading network of mortgage professionals. The DLC Group operates through Dominion Lending Centres Inc. and its three main subsidiaries, MCC Mortgage Centre Canada Inc., MA Mortgage Architects Inc. and Newton Connectivity Systems Inc., and has operations across Canada. The DLC Group's extensive network includes over 8,800 agents and over 500 locations. Headquartered in British Columbia, DLC was founded in 2006 by Gary Mauris and Chris Kayat.

The DLC Group can be found on X (Twitter), Facebook and Instagram and LinkedIn @DLCGmortgage and on the web at www.dlcg.ca.

Contact information for the Corporation is as follows:

To view the source version of this press release, please visit https://www.newsfilecorp.com/release/308448