Okay, James, we can get started.
Good morning, ladies and gentlemen, and thank you for standing by. Welcome to the DATA Communications Management Corp. third quarter 2022 financial results conference call. My name is James Lorimer, and I'm pleased to be hosting today's call. Joining me on the call today is Richard Kellam, President and Chief Executive Officer. Following our prepared remarks, we will be moderating a Q&A session. As a reminder, this conference call is being broadcast live and recorded. We'd also like to remind everyone that Richard and I can be available after the call for any follow-up questions that you may have. Before we begin, I'll remind everyone that we will refer to forward-looking information on today's call. This information is subject to certain risks and uncertainties, as outlined in the forward-looking information disclosure in our press release, and more fully within our public disclosure filings on SEDAR.
We have posted a brief video message from Richard, along with a summary of our results and key initiatives in the quarter on our website in the form of an infographic. Our detailed information is also available on the website and SEDAR. You can also follow us on LinkedIn to keep up to date with some of our business insights on relevant market trends and customer case studies. I'll now turn the call over to Richard.
Thank you, James, and good morning, shareholders, and I guess good afternoon and good evening for some of our shareholders that are dialing in from other time zones. I've been with the business 20, exactly 20 months now. Twenty months ago, we put a strategy in place to build both a better and a bigger business. I'm happy to say we've got, you know, fantastic momentum against the strategy of building a better and bigger business. I'm gonna talk about the momentum today. James, you don't mind just going forward one slide. I'm gonna start off with where we are on the bigger business. Happy to report that after a very strong Q2, shareholders may remember that we actually grew 23.4% in Q2.
We continued to deliver strength in Q3 with 11.4% growth over Q3 a year ago. Total revenue CAD 63.4 million, up CAD 6.5 million versus prior years. From a revenue acceleration perspective off the back of a solid quarter in Q2, and it puts our year-to-date number at 15.1%. We're actually really proud of what we're delivering in terms of building that bigger revenue and bigger business through the quarter and through year to date. From a gross profit standpoint, love to see gross profit growing faster than revenue, and we're certainly seeing that. As I said, revenue up 11.4%, gross profit up 15.8%.
We delivered just around CAD 20 million in gross profit on the quarter, and that equated to 31.4% gross margin as a percent of revenue, and that's up a full 1.2% over a year ago. Very positive gross profit momentum, despite raw material headwinds and pricing headwinds that we experienced. The team has done a fantastic job to ensure that we're getting, you know, kind of full value in return on the materials and the cost increases that we're experiencing. As I said, love seeing gross profit exceeding revenue. That means, we're doing our job of continuing to build a bigger and a better business here.
On the new business side, we have reported just over CAD 30 million in new business this year, and that's a combination of expansion revenue, so expanding revenue within existing clients and then new business development as well. We're winning business across all the key verticals that we work in. A really important point is that of any new business that we're securing today, 100% of it is really due to our technical capabilities. Not that we're great printers, we're fantastic printers, but we enable that print and that workflow with technology, with digital technology. That's really what's differentiated us and allowed us to win a lot of new business out there.
Helping, as we say, clients and customers simplify their complexity, in their marketing communication workflow, and we use technology to help simplify that complexity. Very pleased with our new business development and we've got a great, you know, the commercial team's doing a fantastic job to lead that. A few key highlights on our better business strategy and results of delivering a better business. Happy to report EBITDA continues to move from strength to strength. We're up 25.7% in EBITDA on the quarter. That's CAD 8 million up over a year ago. Sorry, CAD 8 million over a year ago. We were CAD 6.4 million a year ago. We committed to the street, we really committed to our shareholders at the beginning of the year that we would have zero restructuring.
We've got the perfect footprint. We've got, you know, a fantastic kinda organizational structure now, and we're delivering against that. We've had zero restructuring year to date. We don't anticipate any through year end. This is what we call a clean EBITDA, non-restructured EBITDA. Very, very solid progress in EBITDA. We've also had some great success on delivering net income, obviously. If we're not restructuring our business and we're delivering positive cash flow, of course, that's gonna show up in net income. Our net income's up 176% on the quarter.
We delivered CAD 2.8 million in net income up from CAD 1 million a year ago. Year-to-date, our net income is CAD 10.3 million versus CAD 3.4 million a year ago. Real positive net income delivery as well. Finally, really pleased with what the entire team has done on our environmental, social, and governance strategy, and more importantly, deliverables on that strategy. We've got, you know, clear strategy for social and for governance and some really good progress against that, as I said. We're real proud of the accomplishments on environmental, especially, on our, on our commitment to reforestation. We have reforested 100% of our paper use.
The paper we use for clients, 100% of that we've reforested, and that equates to 468,000. 468,000 trees, so approaching half a million trees. In fact, by the time we exit quarter four, we'll be well north of half a million trees. Really proud of what the team has done and our delivery and our commitment on ESG. Okay, over to James to talk a little bit more detail on the numbers. James?
Thanks, Richard. For the nine months ended September thirtieth, revenue was CAD 200 million, and that's up about CAD 26 million from last year or 15.1%. Likewise, gross profit was also up. In this case, it was up 17%. 17.1%. As Richard referenced earlier, we're pleased that gross profit is accelerating at a faster than the revenue growth. Gross profit margin year to date is just over 30%, and we expect that strength that we saw in the third quarter to continue in gross profit in the fourth quarter. SG&A expenses were a little bit higher, and I've got a slide that'll kinda walk through that in a minute. Really pleased here. You know, restructuring expenses last year were fairly significant through this point.
Last year's EBITDA also included CAD four and a half million of wage subsidies. Not only are we, you know, CAD 6.8 million ahead on an EBITDA basis, it's up 34.2%. That is not only clean from restructuring, it's also clean with no wage subsidy included in that. Got a few charts here just to show you our quarter-over-quarter growth. For the third quarter this year and actually the fourth quarter in a row now, our revenue has actually exceeded previous years' quarters. We expect that to continue in the fourth quarter. Likewise, gross profit has also been strong and, you know, has been pretty consistently in that kind of CAD 20 million range.
We're really pleased that in the third quarter we exceeded our 31% target, which we've been guiding the street that we would hit that number in the fourth quarter, so we're a little bit ahead of plan on that. From a SG&A productivity perspective, you know, something, you know, we've set out as kind of objectives for the years or for our five-year plan is an SG&A target of 18%-20% of our revenue. We're pleased to see that we're making great progress, and that's a combination of keeping our SG&A in check, but it's also a combination of higher revenues. SG&A expenses were a little bit higher, sorry, year to date by about CAD 1.8 million.
Big part of that would be related to, because of higher revenues, we are paying higher commissions to our sales reps, and we have experienced a modest wage inflation in that number. Again, just to call out our restructuring expenses were zero through today, and we expect to continue that through the balance of the year. You can see how we've experienced strong year-over-year clean EBITDA, and we did have the benefit again in EBITDA in the first, second, third and fourth quarter. Actually, the first and second quarters last year of the wage subsidy program, which we clearly do not have this year. From a debt perspective, we're pleased that we continue to pay down debt. We've paid down CAD 8.9 million of term debt through the first three quarters.
You can see that our term debt is sitting at about CAD 25 million today. That's more than 26% lower than it was at the end of last year. Our revolving credit facilities sat at about CAD 8.9 million at the end of the year. We did have a cash balance of a little over CAD 1.5 million. From a revolving credit facility, it did come down by about CAD 2 million from June, and we expect it to continue to come down through the balance of this year. With that, I'll turn it back to Richard.
Yeah. I'm gonna close on this chart that just builds. It looks at our core three results, our year-to-date results, and our TTM, our trailing twelve months. Looking at revenue, as I said, 11.4% on the quarter, 15.1% year-to-date. Brings us in at +11.3% on a TTM basis. Across all metrics, super positive. Gross profit again, on all of these you'll see that gross profit is exceeding revenue. I mean, it's obviously gross margins are improving. Gross profit up 15.8, as I said, on the quarter. 17.1% up year-to-date and 17.3% on a TTM basis. You know, positive through all three key metrics.
On net income, as I already referenced, 176% increase in net income on the quarter, 201% increase in net income year to date, and 24% on a TTM basis. We'll see obviously as we roll into the year, right? We dropped quarter four last year, and our TTM is now our fiscal. You'll see that net income number go up substantially on an annual basis. Finally, EBITDA, as I referenced, 25.7% growth in EBITDA. Fantastic delivery on EBITDA. That's clean, no restructuring. Our adjusted EBITDA is the same as our EBITDA. Q4 +34.2% and TTM +19.6%.
We'll see that 19.6 change as well as we move out of. We get fourth quarter out of TTM last year, and we get fourth quarter this year, into our annual, if you will, into our TTM. Real positive and strong momentum across our business. I'm really proud of the team and the accomplishments of the entire team. You know, it really takes the team, everybody kind of moving forward together. It's commercial driven, but it's you know, some of the raw material challenges that we're experiencing, making sure we've got access to raw materials. Purchasing team's done a fantastic job. The operations team to keep supply in check with demand, you know, kind of sweating our assets and running our operations hard, certainly done a fantastic job.
All the other support functions as well, you know, terrific effort and excellent momentum delivered on a year-to-date basis, right? Delivered this year. You know, obviously, as we exited last year and into this year, super strong momentum. Before we turn it over to Q&A, I just want to share something with our shareholders. I've got something in my hand. People dialing in can't see it, but it's actually a catalog from Amazon. Okay? Now, Amazon basically revolutionized online sales, right? Revolutionized online sales. Online e-commerce would not be what it is today without Amazon sort of creating that years ago.
Now, who would have thought that Amazon would have a catalog that, you know, consumers can, shoppers can shop the catalog and obviously use a QR code that leads to the website to buy. Who would have thought that Amazon would use print to help with their marketing communications, to help drive consumer engagement, to help drive consumer penetration? This is just one example from Amazon of a printed piece of material. They also do direct mail and other print communications. For any shareholders that think that print is dead, it's not. It's an important part of communication for all marketers, for all organizations. Again, if it's an important piece of communication for Amazon, right, which is an online retailer, how can it not be for every other? I wanted to share that with you.
We're really bullish in terms of where the market is going and the opportunities we see. We live, we breathe, and like I say to my team, we dream of growth. You're seeing those dreams and actions and activities and strategies showing through in our results. Pleased with the accomplishment of the entire team and the results we've delivered. We'll now turn it over to questions from our shareholders.
Yeah. Thanks, Richard. We'll now take questions from the audience. If you have a question and you're accessing the call directly through Teams, you can re-use the Raise Your Hand feature in Teams, and we'll queue up questions. Alternatively, you can also use the chat feature in Teams, and we'll respond to chat questions as well. If you've dialed in, you may press star five to raise or lower your hand, and pressing star six will mute or unmute your microphone. Please introduce yourself once you're introduced to the session. I have a question from 5740469. I think we lost that question. Okay. Oh, go ahead.
Can you hear me now?
Yes. There we go.
Yeah, sorry. They needed to unmute me. All right, it's Chris Thompson from eResearch. I just was, you know, it's great revenue growth you had. I wonder if you could comment what you're seeing in the market with all the talk of recession. You did mention in your news release that you did see some good wins. I also was looking at your inventory number and was sort of surprised that it's sort of gone up much higher, but wondering if that's, you know, based on your comments about making sure that you had supplies to be able to execute on orders.
Yeah. I'll take on the recession question, and then, we'll flip it over to James to answer the inventory question, Chris. It's a great question, Chris. You know, at this point, we're not experiencing any kind of client wins from a, you know, from an investment perspective. Not to say we aren't anticipating some, but the way we look at it is twofold, right? One is, there's a lot of growth opportunities in the marketplace beyond the clients that we're working with, and we're constantly looking for, new business development. We've got what we call, you know, vertical strategic teams that are responsible for identifying opportunities. We think that even if there are some headwinds from existing clients, there's enough kind of new business opportunities in the marketplace to offset that.
I will say that we're building a very strong growth muscle. A growth muscle or a muscle needs to be built by going to the gym every day. You know, you can't take a break 'cause your muscle will atrophy. We're really, you know, spending a lot of time as a team in building that growth muscle, identifying opportunities. The second thing I'd say to that as well is, we're actually experiencing a little bit of that this year. We're an execution machine. We know how to simplify complex workflows and actually help clients take cost out. That's our competitive difference relative to other marketing communication services companies out there.
As companies, you know, maybe experience some budget challenges, we can help them simplify that complexity and take work out and deliver, you know, more with less, shall we say. We're experiencing that with a couple of clients now, a couple financial clients, where their assets under management, right, are declining, obviously, given the challenges in the marketplace, which means their revenue's declining, which means their budgets are somewhat compromised. We're helping them simplify complexity. Maybe they've been working with another partner, and they come to us because they wanna do the same or they wanna do more with less, and we're helping them solve that complexity and deliver the ability to do more with less.
We actually took a long way to answer your question, we're not experiencing any kinda headwinds yet, but we think we're well-positioned if they do appear. Okay? Now we'll turn it over to James Lorimer for the inventory question.
Yeah. Where you see some inventory growth, Chris, is on a year-over-year basis. In the quarter, we actually came down by CAD 2 million in terms of our raw material inventory. As we talked about it last quarter, we had you know built up some safety stocks given the challenging supply chain market that we're in. That's frankly proved to be very beneficial for us because while we still have challenges we're now able to make sure that we are able to satisfy our clients' demands. We do expect our raw material inventory levels to come down through the balance of the year. We've got a very strong pipeline through the balance of the year and we think we're well positioned for that. Is that it, Chris?
Okay. Thanks. Yeah, that's right. Thanks.
Okay. Great. We have a couple of questions on the chat line from Spencer. Can you clarify the 24% increase in net income versus 200% in previous quarters?
Let me take that, Richard.
Yeah. Well, the 24% increase in net income was a TTM, right? That was a TTM number. We were CAD 175, CAD 166 on the quarter, CAD 200, just over CAD 200 year-to-date. But you can explain why it's 24% on a TTM basis.
Yeah. Well, the TTM basis includes Q4 from 2021, and in Q4 we had a negative net income. We had lower revenue, and we had some other charges that negatively impacted revenue or net income, including some restructuring charges at the end of the year. If we do a TTM basis for a year ago, that includes the benefit of Q4 from 2020, where we actually had very strong net income, largely that was supported by wage subsidy income in the quarter.
As I said earlier, Spencer, right? You'll see that adjust as we get Q4 into our TTM. Q4 2022 into our TTM. You'll see the number go back up into the, you know, into the triple digits.
Okay. A good question, though. Good question.
We have a question from Dave. Says, "Hi, just wondering about thoughts on any possibilities considering some of the recent valuation adjustments in the public markets." Richard, do you wanna handle that?
Yeah. I mean, our strategy is to build a better and a bigger business. Of course, you know, we're really accelerating on organic growth. We're always, you know, listening to the market and understanding there's opportunities out there. Not to say we are, but not to say we wouldn't consider. Yeah, we'll be, you know, opportunistic if there's you know, interest in deals that could be accretive, or opportunities to continue to accelerate our digital penetration. Yeah, I mean, you know, any good strategy building a better and a bigger business requires obviously accelerated organic growth and continue to look at opportunities for M&A if M&A opportunities appear.
Okay. It looks like we don't have any further questions. Any further questions in the audience? All right. No further questions. Richard, do you wanna provide some closing remarks?
Great. Yeah, no, listen, I wanna just close by thanking the entire DCM team. As I said, results like these, you know, 15% growth cannot be delivered without the entire team moving forward together. Wanna sort of shout out and a big thank you to the entire DCM team. There's no question we've built a better business over the last 20 months, and we're seeing that in the numbers presented today. Also maybe, you know, kind of a final thanks to our clients. You know, we've got a fantastic client group. We work with 70 of the top 100 corporations across Canada.
We've got incredible client engagement as well. Thanks to the clients for continuing to value our services, helping simplify their marketing communication complexities. Look forward to reporting a close to the year as we exit quarter four. I guess that'll be early next year. Thank you to all of our shareholders for your continued support and interest in DCM. Thank you.
All right. Thanks, everyone.