Good morning, ladies and gentlemen, and welcome to Yellow Pages ' Second Quarter 2025 Earnings Release Call. Today's conference call contains forward-looking information about Yellow Pages' outlook, objectives, and strategy. These statements are based on assumptions and are subject to important risks and uncertainties. Yellow Pages ' actual results could differ materially from expectations discussed. The details of Yellow Pages ' caution regarding forward-looking information, including key assumptions and risks, can be found in Yellow Pages ' Management Discussion and Analysis for the second quarter of 2025. This call is being recorded and webcast, and all of the disclosure documents are available on the company's website and on SEDAR. I would now like to turn the meeting over to Mrs. Sherilyn King, President and Chief Executive Officer. Please go ahead, Madam.
Thank you, Paul. Good morning, everyone. Welcome to our Second Quarter 2025 Analyst Call. We really appreciate your interest today. Today, I'm joined by Assunta Tortis, our Chief Financial Officer. I will begin with some overview comments, and then Assunta will provide more details on our financials. We will both be available to answer any questions you have at the end of the call. We are quite pleased with our results reported today for our second quarter in 2025. Particularly for the sixth consecutive quarter, we report favorable progress in revenue stability, as our rate of change in revenue was better than the rate of change reported for the previous quarter, and this is key to our success. We are encouraged by the continued momentum in our core metrics driving our revenue performance.
These metrics include continued deceleration of our customer count decline rate, supported by new customer acquisition, stable renewal rates, and strong average spend per customer. We believe these fundamentals position us well for continued success in the medium and long term. We also report solid earnings. Our adjusted EBITDA for the quarter was 20.1% of revenue, even with our continued investments in our revenue initiative. We have a cash balance of approximately CAD 49 million at the end of July. As previously announced on May 21st, 2025, we completed the purchase of a group annuity contract for CAD 210 million from BMO Life Assurance Company. This transaction aligns with the plan to de-risk our defined benefit pension plan as we annuitize approximately 50% of the pension liability. The company intends to voluntarily contribute an additional CAD 4 million to the defined benefit pension plan by the end of June 2026.
Yesterday, the board approved CAD 2 million of this announced voluntary cash contribution to be completed by the end of 2025. Also, our board has declared a dividend of CAD 0.25 per common share to be paid on September 15th, 2025, to shareholders of record on August 25th, 2025. Those are my comments for today, and I will pass it along to Assunta to provide some additional details on our numbers.
Thanks . Good morning, everyone. Let me take you through our financial results for the second quarter ended June 30th, 2025. Our total revenues decreased by CAD 4.2 million or 7.4% year-over-year and amounted to CAD 51.7 million for the second quarter, an improvement from the decrease of 7.6% reported last quarter.
The year-over-year decrease in revenues is mainly due to the decline of our higher margin digital media and print products, and to a lesser extent to our lower margin digital services products, thereby creating pressure on our gross profit margins. Digital revenues decreased 6.4% year-over-year and amounted to CAD 41 million for the three-month period ended June 30th, 2025, an improvement from the decrease of 6.8% reported last quarter. The year-over-year decline was mainly attributable to a decrease in digital customer count, partially offset by an increase in average spend per customer. Print revenues decreased 11.2% year-over-year and amounted to CAD 10.7 million for the three-month period ended June 30th. The decline in print revenue was mainly attributable to the decrease in the number of print customers, while the spend per customer has improved year-over-year, driven by price increase.
The decline rate of revenues improved during the quarter ended June 30th, 2025, compared to the same period last year. The improvements were mainly due to the deceleration of the customer count decline rate, fueled by an increase in the new customer acquisitions, while renewal rates remained relatively stable, and an increase in average spend per customer due in part to price increases. Adjusted EBITDA for the second quarter was impacted by pressures from lower revenue, change in product mix, continued investments in our sales force capacity, and the impact of the company's share price on cash settled stock-based compensation expense, partially offset by price increases, the efficiencies from optimization in cost of sales, and reduction in the operating costs, including reduction in our workforce and associated employee expenses. As a result, adjusted EBITDA decreased year-over-year by CAD 4.1 million or 27.7% to CAD 10.7 million for the quarter.
Adjusted EBITDA margin decreased to 20.7% compared to 26.5% for the same period last year. The revaluation of cash settled stock-based compensation liabilities resulted in a charge of CAD 0.6 million for the three-month period ended June 30th, 2025, compared to a recovery of CAD 1.2 million for the same period last year. Revenue pressures and continued investments in our sales force capacity, partially offset by continued optimizations, will continue to cause pressure on margins in upcoming quarters. Adjusted EBITDA less CapEx for the second quarter decreased by CAD 3.7 million year-over-year to CAD 10.4 million, mainly due to the decrease in adjusted EBITDA, partially offset by the decrease in CapEx spend year-over-year. As [King] mentioned, on May 21, 2025, the company announced the purchase of the group annuity contracts of CAD 209.9 million from BMO Life Assurance Company.
The defined benefit pension plan obligations for the group that are settled via the annuity purchase are CAD 205.9 million on an accounting basis. As a result, a non-cash settlement loss of CAD 4 million was recognized during the second quarter of 2025. As also announced, the company intends to voluntarily contribute an additional CAD 4 million to the remaining defined benefit pension plan by the end of June 2026, subject to board approval. On August 5th, 2025, our board approved that CAD 2 million of the announced voluntary cash contributions be completed by the end of 2025. Net income for the quarter decreased to CAD 1.5 million, compared to CAD 7.6 million for the same period last year, due to lower adjusted EBITDA, the settlement loss on the annuity purchase, and the increase in restructuring and other charges, partially offset by the decrease in depreciation and amortization and income tax.
As of June 30th, 2025, our total workforce decreased to 566 employees, compared to 603 at the same date last year, a decrease of 6.1%. As Sherilyn mentioned, our cash on hand at the end of July stood at approximately CAD 49 million. The board has also declared a cash dividend of CAD 0.25 per common share, payable on September 15 to shareholders of record as at August 25, 2025. This concludes our formal remarks. Thank you for taking the time to join us this morning. We will now take your questions.
Thank you.
Paul
We will now take questions from the telephone lines. If you have a question, please press star one on the device's keypad. You may cancel your question at any time by pressing star two. Please press star one at this time if you have a question. There will be a brief pause while the participants register. We thank you for your patience. Once again, please press star one on the device's keypad if you have a question. There are no questions being registered on the telephone lines. I will turn the meeting back over to Mrs. King.
Thank you, Paul. I'd just like to thank everyone for your interest in joining our call today, and we look forward to speaking with you again in November. Thanks, everyone, and have a great day.
Thank you. The conference has now ended. Please disconnect your lines at this time, and we thank you for your participation.