EIC reports Record Q2 Results, EPS up 29%; Raises Adjusted EBITDA Guidance Range to between $890 million to $920 million; and Increases Dividend

The Corporation Posts New Second Quarter Records for Revenue, Adjusted EBITDA1, Free Cash Flow1, Free Cash Flow less Maintenance Capital Expenditures, Net Earnings and Adjusted Net Earnings1 along with Record Net Earnings and Adjusted Net Earnings Per Share AmountsWINNIPEG, Manitoba--(BUSINESS WIRE)--$EIF #dividend--Exchange Income Corporation (TSX: EIF) (“EIC” or the “Corporation”) a diversified, acquisition-oriented company focused on opportunities in the Aerospace & Aviation and Manufacturing segments, reported its financial results for the three and six-months ending June 30, 2026. All amounts are in Canadian currency. Financial Highlights from EIC’s Second Quarter 2026 Record second quarter Revenue of $952 million, an increase of $232 million or 32% compared to the prior period. Record second quarter Adjusted EBITDA of $226 million, representing growth of $49 million over the prior period or 28%. Record second quarter Free Cash Flow of $161 million, representing growth of 30% compared to the prior period of $123 million. Record second quarter Net Earnings of $57 million compared to the prior period of $40 million, an increase of 42%, and record Net Earnings per share of $1.01 compared to the prior period of $0.78 or an increase of 29%. Record second quarter Adjusted Net Earnings of $64 million compared to the prior period of $47 million, an increase of 35%, and record Adjusted Net Earnings per share of $1.13 compared to the prior period of $0.92 or an increase of 23%. Record second quarter Free Cash flow less Maintenance Capital Expenditures of $74 million compared to $57 million in the prior period or an increase of 29%. Trailing Twelve-Month Free Cash Flow less Maintenance Capital Expenditures Payout Ratio improved to 55% compared with the prior period of 63% and Trailing Twelve Month Adjusted Net Earnings Payout Ratio was an all-time low 65% compared to the prior period of 81%. The significant declines in our payout ratios included period over period increases in weighted average number of shares outstanding of 10% along with the 5% increase in dividend announced during the fourth quarter of fiscal 2025. Subsequent to quarter end, announced the finalized contract with Air Greenland to support the missionization of two DCH-8-200 aircraft for Maritime Domain Awareness operations in Greenland. Subsequent to quarter end, announced the non-exercise of the Government of Nunavut Equity Option. Subsequent to quarter end, announced an agreement on the scope of services with SkyAlyne to provide aircraft modifications, training and in-service support for the operation of the fleet under the Future Aircrew Training program. 2026 Guidance Update and Increase in monthly dividend Based on our very strong first and second quarter results, momentum achieved and outlook for each of our business lines, we expect that our Adjusted EBITDA for Fiscal 2026 to be in the range of $890 million to $920 million. As a result of our strong results and confidence in our future outlook, we announced our dividend is increasing from $0.23 to $0.24 monthly per share or from $2.76 to $2.88 per share on an annualized basis starting for the month ending August 31, 2026, payable on September 15, 2026, to shareholders of record at the close of business on August 31, 2026. ____________________ 1 Adjusted EBITDA, Adjusted Net Earnings, Free Cash Flow, Free Cash Flow less Maintenance Capital Expenditures, Maintenance and Growth Capital Expenditures, and the corresponding per share amounts and payout ratios are Non-IFRS measures. See Appendix A for more information. CEO Commentary Mike Pyle, CEO, commented, “The financial results of the second quarter once again proved the strength and resilience of our diversified business model. Quarterly records were achieved in the key financial metrics of Revenue, Adjusted EBITDA, Free Cash Flow, Free Cash Flow less Maintenance Capital Expenditures, Net Earnings and Adjusted Net Earnings. Furthermore, records were also set on per share metrics, which is even more remarkable when you consider that the number of outstanding shares, period over period, was approximately 10% primarily higher due to the conversion of the convertible debentures in the prior year. The operating results also lead to a nearly all-time low in our Free Cash Flow less Maintenance Capital Expenditure Payout Ratio and an all-time low in our Adjusted Net Earnings Payout Ratio. These incredibly positive results, coupled with our confidence in our outlook, have allowed the Board of Directors and management to increase our dividend. Our annualized per share dividend rate will increase from $2.76 to $2.88 per share for the August dividend date, which will equate to $0.24 per share monthly. On our first quarter conference call, I spoke about our accelerating momentum in our various business lines and that momentum has continued throughout the quarter and after quarter end. Our Aerospace & Aviation segment continued to generate strong operating results due to the acquisitions of Canadian North on July 1, 2025, the acquisition of Mach2 on January 31, 2026, strong passenger load factors across various jurisdictions, solid performance under our medevac contracts, past contract awards, and Growth Capital Expenditures. Momentum and solid operating results continued within each of the business lines. Our Essential Air Services business line continued to see strong demand trends on all operational fronts including scheduled service, cargo, charter and medevac. Our Aircraft Sales & Leasing business line continued to see strong demand signals as several aircraft were placed on lease and the business continued to experience robust demand for the business line’s aircraft and engines. Lastly, the announcement of a contract with Air Greenland and the Government of Denmark along with the finalization of the scope of services under the SkyAlyne Future Aircrew Training program demonstrated strong demand for our world-class Aerospace business line services. Our Manufacturing segment’s strong financial results continued throughout the quarter as momentum continued to build. Our Environmental Access Solutions business line profitability continued to strengthen compared to the prior period. The Canadian operations continued to see strong volumes of mat rentals supporting solid revenue and profitability increases compared to the prior period. The US composite operations continued to see robust demand for its products and the decision to build a state-of-the-art composite mat plant in Saltillo, Mississippi will provide further opportunities for US expansion. The plant is on-budget and on-time with operations expected to commence in the latter part of Fiscal 2027. Our Multi-Storey Window Solutions business line results were in line with expectations as the market works through a softer demand environment from previous periods driven by project timing and past developer decision-making. We were encouraged to see our strongest quarter of bookings over the past several years during the second quarter, which were geographically diversified across North America and in a variety of end markets. The positivity noted in the first and second quarters in the Multi-Storey Window Solutions business line does not yet provide conclusive evidence of a wide scale recovery as the Southern Ontario market remains challenged due to investor-focused condominium supply and larger condominium demand imbalances. Our Precision Manufacturing and Engineering business line delivered strong performance on Revenues and Adjusted EBITDA across several end markets, customers and geographies as business sentiment continued to strengthen.” “Our pipeline of acquisition opportunities continues to be active with a number of targets in adjacent businesses in both operating segments; however, we remain disciplined in ensuring that we acquire companies that will enhance our business model while exceeding our stringent investment returns along with our other acquisition criteria,” noted Adam Terwin, EIC’s Chief Corporate Development Officer. “The acquisition of Mach2 in January was a highly strategic fit for our Aircraft Sales & Leasing business line and for our Canadian North operations. I am pleased to report that the integration of Mach2 amongst our Aerospace & Aviation segment and investment returns has exceeded expectations to date. The EIC story continues to resonate with potential vendors in sourcing opportunities as it did with the Mach2 owners and management team.” Q2 Selected Highlights (All amounts in thousands except % and share data) Q2 2026 Q2 2025 % Change YTD 2026 YTD 2025 % Change Revenue $952,159 $719,928 32% $1,818,742 $1,388,204 31% Adjusted EBITDA $226,222 $177,236 28% $392,316 $307,372 28% Net Earnings $56,923 $40,010 42% $84,817 $47,217 80% per share (basic) $1.01 $0.78 29% $1.51 $0.93 62% Adjusted Net Earnings $63,671 $47,156 35% $97,775 $61,451 59% per share (basic) $1.13 $0.92 23% $1.74 $1.21 44% Trailing Twelve Month Adjusted Net Earnings Payout Ratio (basic) 65% 81% 65% 81% Free Cash Flow $160,746 $123,424 30% $280,992 $204,908 37% per share (basic) $2.85 $2.40 19% $4.99 $4.02 24% Free Cash Flow less Maintenance Capital Expenditures $74,390 $57,487 29% $115,417 $82,987 39% per share (basic) $1.32 $1.12 18% $2.05 $1.63 26% Trailing Twelve Month Free Cash Flow less Maintenance Capital Expenditures Payout Ratio (basic) 55% 63% 55% 63% Dividends declared $38,889 $33,933 15% $77,705 $67,483 15% Review of Q2 Financial Results Consolidated revenue for the quarter was $952 million, which was an increase of $232 million or 32% over the prior period. Adjusted EBITDA for the quarter was $226 million, which was an increase of $49 million or 28% compared to the second quarter of last year. Revenue generated by the Aerospace & Aviation segment increased by $194 million or 43% to $649 million and Adjusted EBITDA increased by $45 million or 31% to $193 million over the prior period. The significant drivers of the revenue and profitability increases relate to the acquisitions of Canadian North and Mach2, continued momentum and growth in our Aircraft Sales & Leasing business line, enhanced profitability related to Growth Capital Expenditures undertaken in prior years, strong load factors across various air operators, and increased tempo of flying on owned ISR aircraft. Revenue in the Manufacturing segment increased by $38 million or 14% to $303 million and Adjusted EBITDA increased by $9 million or 19% to $53 million. The Environmental Access Solutions business line continued to experience robust demand for its composite mat solutions within its US operations. The Canadian operations continued to see strong volumes on mat rentals supporting solid revenue and profitability compared to the prior period. Revenues and profitability within the Multi-Storey Windows Solutions business line moderated as expected relative to the prior period reflecting the timing of project awards in prior years due to cautious developer decision-making at that time. Our Precision Manufacturing & Engineering business line revenues and Adjusted EBITDA continued with strong growth over the prior period. EIC recorded Net Earnings of $57 million compared to $40 million in the prior period or an increase of 42%. Furthermore, EIC recorded Adjusted Net Earnings of $64 million compared to $47 million in the prior period or an increase of 35%. The Corporation generated Free Cash Flow of $161 million, a $37 million increase over $123 million in the prior period primarily due to the higher Adjusted EBITDA partially offset by an increase in principal payments on right of use assets and current taxes. Free Cash Flow less Maintenance Capital Expenditures was $75 million compared to $58 million in the prior period or an increase of 30%. The increase in Adjusted EBITDA was partially offset by the expected increase in Maintenance Capital Expenditures, arising from the acquisition of Canadian North, the increase in fleet size, hours flown and inflationary effects on maintenance events. The Corporation’s Trailing Twelve-Month Free Cash Flow less Maintenance Capital Expenditures payout ratio continued to strengthen to 55% compared to the prior year of 63% and the Adjusted Net Earnings payout ratio continued to improve to an all-time low of 65% compared to the prior year of 81%. Despite the 10% increase in shares outstanding due to the conversion of convertible debt instruments and the 5% dividend increase announced in the fourth quarter of 2025, our dividend payout metrics continued to improve on both Free Cash Flow less Maintenance Capital Expenditures and Adjusted Net Earnings basis—reinforcing the strength of our model. Richard Wowryk, EIC’s CFO also noted, “Our balance sheet continues to be very strong, and our total leverage ratio remains near historical lows which is well within our target range. Over the past couple of years, we have made significant investments in Growth Capital Expenditures into our businesses, along with acquisitions, and they are generating the expected returns anticipated when making those investments. The Growth Capital Expenditures have further diversified the cash flows of our underlying businesses and have increased their competitive advantages in their markets. This has resulted in further compounding of the operating performance of our businesses, and we are seeing the significant cash flow being generated resulting in a near historic low in our Free Cash Flow less Maintenance Capital Expenditure payout ratio and an all-time low in our Adjusted Net Earnings payout ratio. Further, we have also seen the impacts of those investments and acquisitions on our record per share metrics even with a 10% increase in the weighted average number of shares outstanding due to the conversion of the convertible debentures in the prior year, which resulted in us entering 2026 with no convertible debentures on our balance sheet for the first time in our history. Our balance sheet and our operating results are very strong, and we continue to have significant liquidity to deploy for further accretive organic growth initiatives and acquisitions.” OutlookRead the full story here

EIC reports Record Q2 Results, EPS up 29%; Raises Adjusted EBITDA Guidance Range to between $890 million to $920 million; and Increases Dividend

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