Enghouse Systems Limited

Q4 revenue was $124.5 million, versus $125.7 million in Q4 last year. Full-year revenue was $498.9 million, down slightly from $502.5 million in fiscal 2024. Q4 adjusted EBITDA was $33.7 million with a 27% margin; full-year adjusted EBITDA was $127.6 million with a 25.6% margin. Q4 net income was $21.1 million; full-year net income was $73.7 million, or $1.34 per diluted share. The company ended the year with $269.1 million in cash and no external debt. Looking ahead, management did not provide formal revenue or EPS guidance, but said fiscal 2026 should be a “good, stable year,” with further efficiency gains, some additional profitability from transportation projects in the Netherlands, and more capital deployment toward acquisitions and share repurchases. The board also approved a quarterly dividend of $0.30 per share payable on February 27, 2026.

Stephen Sadler said the company is focused on practical execution rather than chasing growth in a weak market. He stressed that many customers are struggling to monetize AI, so Enghouse is setting up two professional-services groups in IMG and AMG to help customers with AI using a small language model approach, while also learning what can be productized later. He described fiscal 2026 as likely “good” and stable, with more emphasis on acquisitions, stock repurchases, and disciplined capital allocation than on aggressive organic growth.

Rob Medved said fiscal 2025 was challenging because of economic, technological, and geopolitical uncertainty, but Enghouse stayed profitable through its diversified model and disciplined execution. He highlighted that recurring revenue was over 69% of revenue, adjusted EBITDA reached $33.7 million in Q4 with a 27% margin, and the year ended with $269.1 million in cash and no external debt. He also noted that AMG was a standout, with Q4 revenue of $55.7 million, up 9.3% year over year, and full-year revenue of $213.1 million, up more than 10%, helped by Margento and Trafi. He said the company returned $61.8 million through dividends in 2025, up 16% from last year, and repurchased $14.7 million of shares.

Analysts asked about LifeSci’s revamped go-to-market plan, and management said the new version is only being launched in January after removing third-party products that made costs too high. They also pressed on organic growth, divestitures, and M&A, and Sadler said Enghouse sees itself primarily as a capital allocator rather than a company trying to force growth in a slow market. Questions on AI focused on whether it could become a software or services opportunity; management said the near-term plan is to use professional services to help customers and learn what can be monetized later, but they do not expect that to drive software revenue in 2026. Analysts also asked about dividend policy and margins, and Sadler said margins could be higher than 27% absent new M&A, while dividend increases would likely be smaller as more capital goes to acquisitions and buybacks.