RAY.B Stingray Group Inc

Stingray Group Inc. (TSX: RAY.A; RAY.B) (the “Corporation”; “Stingray”), an industry leader in music and video content distribution, business services, and advertising solutions, announced today its financial results for the second quarter of fiscal 2025 ended September 30, 2024.

Financial Highlights(in thousands of Canadian dollars, except per share data)	Three months endedSeptember 30				Six months ended September 30
	2025	2024	%		2025	2024	%
Revenues	93,585	82,493	13.4		182,655	161,485	13.1
Adjusted EBITDA(1)	33,994	29,518	15.2		65,064	57,784	12.6
Net income	5,813	9,389	(38.1	)	13,108	23,507	(44.2	)
Per share – diluted ($)	0.08	0.14	(42.9	)	0.19	0.34	(44.1	)
Adjusted Net income(1)	16,729	14,554	14.9		30,662	26,447	15.9
Per share – diluted ($)	0.24	0.21	14.3		0.44	0.38	15.8
Cash flow from operating activities	19,183	19,101	0.4		29,933	43,361	(31.0	)
Adjusted free cash flow(1), (2)	21,103	14,567	44.9		36,565	33,024	10.7

1)		This is a non-IFRS measure and is not a standardized financial measure. The Corporation’s method of calculating such financial measures may differ from the methods used by other issuers and, accordingly, the definition of these non-IFRS financial measures may not be comparable to similar measures presented by other issuers. Refer to “Non-IFRS Measures” on page 4 of this news release for more information about each non-IFRS measure and refer to pages 5-6 for the reconciliations to the most directly comparable IFRS financial measures.
2)		Non-material adjustments were made to Adjusted free cash flow in comparable periods due to the double counting of an element in initial calculations.

Reporting on second quarter results for fiscal 2025, Stingray's President, co-founder and CEO Eric Boyko stated:

“Stingray’s FAST channel and retail media segments continued to drive growth in the second quarter of fiscal 2025, raising advertising revenues by 66% year-over-year. A pilot project with Vizio on the FAST channel side, combined with increased penetration with other TV manufacturers, largely contributed to the significant revenue growth. We also benefited from digital equipment installations at new accounts across our North American advertising platform to bolster revenues. On the retail media front, key customer wins at Sobeys, Shoppers Drug Mart and Mondou within our Canadian network should deliver meaningful revenue contributions in the second half of the fiscal year and beyond.”

“Moving on to our in-car entertainment business, we recently launched Stingray Karaoke in Ford Motor Company vehicles, beginning with the all-electric F-150 Lightning and Mustang Mach-E, while further deployments are expected across the Ford and Lincoln fleet. We also secured a similar agreement with NIO for its smart electric vehicles across European countries and expanded our footprint at BYD with an updated version of our Karaoke app. In addition, we created a whole new revenue stream within the in-car entertainment space through a partnership with Xperi/TiVo by introducing eight new channels on video screens for backseat passengers of BMW Group vehicles. This premium video offering will be extended to other luxury car manufacturers in upcoming quarters as we position Stingray as a supplier of choice in this market.”

“Altogether, revenues for our Broadcasting and Commercial Music business increased 22.2% to $60.9 million in the second quarter of 2025, while Radio revenues remained stable year-over-year at $32.7 million as we kept outpacing industry peers.”

“Notwithstanding these positive data points, we achieved organic growth (excluding Radio) of 15.6% in the second quarter, marking four consecutive reporting periods in which Stingray has generated robust revenue increases year-over-year. This string of strong organic results, in turn, has provided an enhanced degree of predictability to our profitability, including maintaining a consolidated Adjusted EBITDA margin of approximately 35%.” Mr. Boyko concluded.

Second Quarter ResultsRevenues increased $11.1 million, or 13.4%, to $93.6 million in Q2 2025 from $82.5 million in Q2 2024. The year-over-year growth was mainly due to an increase in FAST channel sales as well as higher equipment and installation sales related to digital signage.

For the quarter, revenues in Canada rose $0.5 million, or 1.1%, to $48.9 million from $48.4 million in Q2 2024. The growth reflects enhanced equipment and installation sales related to digital signage, partially offset by a decrease in audio channel revenues.

Revenues in the United States grew $11.3 million, or 52.5%, to $32.9 million in Q2 2025 from $21.6 million in Q2 2024. The increase can largely be attributed to higher FAST channel revenues, along with enhanced equipment and installation sales related to digital signage.

Revenues in Other countries decreased $0.7 million, or 5.9%, to $11.8 million in Q2 2025 from $12.5 million in Q2 2024. The decline was mainly due to reduced business-to-consumer (B2C) subscriptions and less audio channel revenues.  

Broadcasting and Commercial Music revenues increased $11.1 million, or 22.2%, to $60.9 million in Q2 2025 from $49.8 million in Q2 2024. The growth was primarily driven by higher FAST channel revenues and greater equipment and installation sales related to digital signage. Radio revenues remained stable year-over-year at $32.7 million in Q2 2025 as higher digital advertising sales were offset by slightly lower national airtime revenues.

Consolidated Adjusted EBITDA(1) improved $4.5 million, or 15.2%, to $34.0 million in Q2 2025 from $29.5 million in Q2 2024. Adjusted EBITDA margin(1) reached 36.3% in Q2 2025 compared to 35.8% in the same period in 2024. The growth in Adjusted EBITDA(1) and Adjusted EBITDA margin(1)   was mainly due to higher revenues.

Net income totaled $5.8 million, or $0.08 per share, in Q2 2025 compared to $9.4 million, or $0.14 per share, in Q2 2024. The decrease was mainly caused by a loss in the fair value of derivative financial instruments and to a negative foreign exchange impact, partially offset by higher operating results.

Adjusted net income(1) reached $16.7 million, or $0.24 per share, in Q2 2025 compared to $14.6 million, or $0.21 per share, in the same period of 2024. The increase can primarily be attributed to better operating results, partially offset by a foreign exchange loss.

Cash flow generated from operating activities totaled $19.2 million in Q2 2025 compared to $19.1 million in Q2 2024. The year-over-year improvement was mainly due to better operating results, largely offset by a foreign exchange loss and a higher negative change in non-cash operating items. Adjusted free cash flow(1),(2) amounted to $21.1 million in Q2 2025 compared to $14.6 million in the same period of 2024. The increase was mainly due to higher operating results.

As at September 30, 2024, the Corporation had cash and cash equivalents of $8.6 million, subordinated debt of $25.6 million and credit facilities of $350.5 million, of which approximately $68.0 million was available. The Net Debt to Pro Forma Adjusted EBITDA ratio(1) stood at 2.72x as at September 30, 2024 compared to 3.19x as at September 30, 2023.

Declaration of DividendOn November 5, 2024, the Corporation declared a dividend of $0.075 per subordinate voting share, variable subordinate voting share and multiple voting share. The dividend will be payable on or around December 13, 2024 to shareholders on record as of November 29, 2024.

The Corporation’s dividend policy is at the discretion of the Board of Directors and may vary depending upon, among other things, our available cash flow, results of operations, financial condition, business growth opportunities and other factors that the Board of Directors may deem relevant.

The dividends paid are designated as "eligible" dividends for the purposes of the Income Tax Act (Canada) and any corresponding provisions of provincial and territorial tax legislation.

Business Highlights and Subsequent Events

• On October 21, 2024, the Corporation announced the launch of eight new video channels — Stingray Naturescape, Stingray Holidayscapes, ZenLIFE by Stingray, Qello Concerts by Stingray, Stingray Classica, Stingray CMusic, Stingray DJAZZ, and Ultimate Trivia by Stingray — on the DTS AutoStage Video Service Powered by TiVo. This strategic expansion is set to transform in-car entertainment by offering a diverse array of premium content to a wide range of vehicles in the current product portfolio of the BMW Group, providing a cohesive and comprehensive solution that caters to the evolving needs of modern car owners, drivers, and passengers.
• On October 1, 2024, the Corporation announced the launch of the Stingray Karaoke app on VIZIO. Starting today, karaoke fans can access an extensive library of over 100,000 licensed songs directly through the Stingray Karaoke app available on millions of VIZIO Smart TVs.
• On September 25, 2024, the Corporation announced that the Toronto Stock Exchange (“TSX”) has approved the renewal of its normal course issuer bid (“NCIB”), authorizing Stingray to repurchase up to an aggregate 3,542,716 subordinate voting shares and variable subordinate voting shares (collectively, “Subordinate Shares”), representing approximately 10% of the “public float” (as defined in the TSX Company Manual) of Subordinate Shares as at September 13, 2024.
• On September 19, 2024, the Corporation announced the launch of two new free ad-supported TV channels, Stingray Naturescape and ZenLIFE, on Amazon Fire TV Channels. These channels are designed to bring tranquility and wellness into the homes of viewers worldwide, with additional videos also available on ad-supported video on demand (AVOD) on the platform.
• On September 17, 2024, the Corporation announced the launch of Stingray Karaoke in Ford Motor Company’s vehicles. Starting with the all-electric F-150® Lightning® and Mustang Mach-E and coming soon to vehicles with the Ford and Lincoln Digital Experience. This will be the first time karaoke is available for Ford owners to use and enjoy inside the vehicle while parked and on the go.
• On September 16, 2024, the Corporation announced the launch of Stingray Karaoke in NIO’s smart electric vehicles across European territories. This exciting new feature will be available in all NIO cars sold in Europe over the next two years, with each vehicle enjoying three years of complimentary karaoke service.
• On July 17, 2024, the Corporation announced the launch of two free ad-supported TV channels, Qello Concerts by Stingray and ZenLIFE by Stingray, on Amazon Freevee.
• On July 9, 2024, the Corporation announced the acquisition of The Coda Collection, a premier music-focused streaming platform. This strategic move solidifies Stingray’s position as the leading provider of concert streaming on the world’s most popular platforms.

Conference CallThe Corporation will hold a conference call tomorrow, November 6, 2024, at 10:00 AM (ET), to review its financial results. Interested parties can join the call by dialing 289-514-5100 (Toronto) or 1-800-717-1738 (toll free). A rebroadcast of the conference call will be available until midnight, December 6, 2024, by dialing 289-819-1325 or 1-888-660-6264 and entering passcode 77780.

About StingrayStingray (TSX: RAY.A; RAY.B), a global music, media, and technology company, is an industry leader in TV broadcasting, streaming, radio, business services, and advertising. Stingray provides an array of global music, digital, and advertising services to enterprise brands worldwide, including audio and video channels, over 100 radio stations, subscription video-on-demand content, FAST channels, karaoke products and music apps, and in-car and on-board infotainment content. Stingray Business, a division of Stingray, provides commercial solutions in music, in-store advertising solutions, digital signage, and AI-driven consumer insights and feedback. Stingray Advertising is North America’s largest retail audio advertising network, delivering digital audio messaging to more than 30,000 major retail locations. Stingray has close to 1,000 employees worldwide and reaches 540 million consumers in 160 countries. For more information, visit www.stingray.com

Forward-Looking InformationThis news release contains forward-looking information within the meaning of applicable Canadian securities law. Such forward-looking information includes, but is not limited to, information with respect to Stingray's goals, beliefs, plans, expectations, anticipations, estimates and intentions. Forward-looking information is identified by the use of terms and phrases such as "may", "would", "should", "could", "expect", "intend", "estimate", "anticipate", "plan", "foresee", "believe", and "continue", or the negative of these terms and similar terminology, including references to assumptions. Please note, however, that not all forward-looking information contains these terms and phrases. Forward-looking information is based upon a number of assumptions and is subject to a number of risks and uncertainties, many of which are beyond Stingray's control. These risks and uncertainties could cause actual results to differ materially from those that are disclosed in or implied by such forward-looking information. These risks and uncertainties include, but are not limited to, the risk factors identified in Stingray's Annual Information Form for the year ended March 31, 2024, which is available on SEDAR at www.sedar.com. Consequently, all of the forward-looking information contained herein is qualified by the foregoing cautionary statements, and there can be no guarantee that the results or developments that Stingray anticipates will be realized or, even if substantially realized, that they will have the expected consequences or effects on Stingray's business, financial condition or results of operation. Unless otherwise noted or the context otherwise indicates, the forward-looking information contained herein is provided as of the date hereof, and Stingray does not undertake to update or amend such forward-looking information whether as a result of new information, future events or otherwise, except as may be required by applicable law.

Non-IFRS MeasuresThe Corporation believes that Adjusted EBITDA and Adjusted EBITDA margin are important measures when analyzing its operating profitability without being influenced by financing decisions, non-cash items and income taxes strategies. Comparison with peers is also easier as companies rarely have the same capital and financing structure. The Corporation believes that Adjusted Net income and Adjusted Net income per share are important measures as it shows stable results from its operation which allows users of the financial statements to better assess the trend in the profitability of the business. The Corporation believes that Adjusted free cash flow and Adjusted free cash flow per share are important measures when assessing the amount of cash generated after accounting for capital expenditures and non-core charges. It demonstrates cash available to make business acquisitions, pay dividend and reduce debt. The Corporation believes that Net debt and Net debt to Pro Forma Adjusted EBITDA are important to analyse the company's debt repayment capacity on an annualized basis, taking into consideration the annualized adjusted EBITDA of acquisitions made during the last twelve months.

Each of these non-IFRS financial measures is not an earnings or cash flow measure recognized by International Financial Reporting Standards (IFRS) and does not have a standardized meaning prescribed by IFRS. This method of calculating such financial measures may differ from the methods used by other issuers and, accordingly, our definition of these non-IFRS financial measures may not be comparable to similar measures presented by other issuers. Investors are cautioned that non-IFRS financial measures should not be construed as an alternative to net income determined in accordance with IFRS as indicators of our performance or to cash flows from operating activities as measures of liquidity and cash flows.

Reconciliation of Net income to Adjusted EBITDA, Adjusted Net income, LTM Adjusted EBITDA and Pro Forma Adjusted EBITDA

	3 months					6 months
(in thousands of Canadian dollars)	Sept. 30,2024Q2 2025		Sept. 30,2023Q2 2024			Sept. 30,2024YTD 2025		Sept. 30,2023YTD 2024
Net income	5,813		9,389			13,108		23,507
Net finance expense (income)	12,162		5,582			21,261		9,988
Change in fair value of investments	29		(86	)		(13	)	21
Income taxes	2,457		3,467			5,980		9,205
Depreciation and write-off of property and equipment	1,970		2,373			4,045		4,758
Depreciation of right-of-use assets	1,137		1,069			2,227		2,154
Amortization of intangible assets	4,199		4,811			8,370		9,244
Share-based compensation	106		120			236		221
Performance and deferred share unit expense	1,763		590			2,599		(617	)
Share of results of investments in associates	1,827		1,011			3,879		1,011
Acquisition, legal, restructuring and other expenses	2,531		1,192			3,372		(1,708	)
Adjusted EBITDA	33,994		29,518			65,064		57,784
Adjusted EBITDA margin	36.3%		35.8%			35.6%		35.8%
Net income	5,813		9,389			13,108		23,507
Adjusted for:
Change in fair value of derivative financial instruments	4,434		(600	)		5,487		(4,235	)
Amortization of intangible assets	4,199		4,811			8,370		9,244
Change in fair value of investments	29		(86	)		(13	)	21
Share-based compensation	106		120			236		221
Performance and deferred share unit expense	1,763		590			2,599		(617	)
Acquisition, legal, restructuring and other expenses	2,531		1,192			3,372		(1,708	)
Share of results of investments in associates	1,827		1,011			3,879		1,011
Income taxes related to change in fair value of investments, share-based compensation, performance and deferred share unit expense, amortization of intangible assets, change in fair value of derivative financial instruments and acquisition, share of results of investments in associates, legal, restructuring and other expenses	(3,973	)	(1,873	)		(6,376	)	(997	)
Adjusted Net income	16,729		14,554			30,662		26,447
Average number of shares outstanding (diluted)	69,022		69,349			69,094		69,392
Adjusted Net income per share (diluted)	0.24		0.21			0.44		0.38

(in thousands of Canadian dollars)	September 30,2024	September 30,2023	March 31,2024
LTM Adjusted EBITDA	133,135	118,807	125,855
Permanent cost-saving initiatives	1,476	3,438	2,758
Adjusted EBITDA for the months prior to the business acquisition of The Coda Collection which are not already reflected in the results	449	-	-
Pro Forma Adjusted EBITDA	135,060	122,245	128,613

Reconciliation of Cash Flow from Operating Activities to Adjusted Free Cash Flow

	3 months					6 months
(in thousands of Canadian dollars)	Sept. 30,2024Q2 2025		Sept. 30,2023Q2 2024			Sept. 30,2024YTD 2025		Sept. 30,2023YTD 2024
Cash flow from operating activities	19,183		19,101			29,933		43,361
Add / Less :
Acquisition of property and equipment	(1,886	)	(2,350	)		(3,372	)	(3,719	)
Acquisition of intangible assets other than internally developed intangible assets	(205	)	(318	)		(649	)	(620	)
Addition to internally developed intangible assets	(1,268	)	(1,274	)		(2,550	)	(2,574	)
Interest paid	(6,356	)	(7,093	)		(12,335	)	(12,666	)
Repayment of lease liabilities	(1,324	)	(1,368	)		(2,316	)	(2,425	)
Net change in non-cash operating working capital items	9,848		8,054			22,681		14,144
Unrealized loss (gain) on foreign exchange	580		(1,377	)		1,801		(769	)
Acquisition, legal, restructuring and other expenses	2,531		1,192			3,372		(1,708	)
Adjusted free cash flow(1)	21,103		14,567			36,565		33,024

Calculation of Net Debt and Net Debt to Pro Forma Adjusted EBITDA Ratio

(in thousands of Canadian dollars)	September 30,2024		September 30,2023		March 31,2024
Credit facilities	350,500		374,573		338,712
Subordinated debt	25,583		25,593		25,579
Cash and cash equivalents	(8,593	)	(9,704	)	(9,606	)
Net debt	367,490		390,462		354,685
Net debt to Pro Forma Adjusted EBITDA	2.72		3.19		2.76

Note to readers: Consolidated financial statements and Management’s Discussion & Analysis of Operating Results and Financial Position are available on the Corporation’s website at www.corporate.stingray.com and on SEDAR at www.sedar.com.

Contact InformationMathieu PéloquinSenior Vice-President, Marketing and CommunicationsStingray(514) 664-1244, ext. 2362mpeloquin@stingray.com