Earnings call transcript: Currency Exchange International’s Q3 2025 earnings beat forecasts

Currency Exchange International Corp (CXI) reported robust financial results for the third quarter of 2025, with earnings per share (EPS) surpassing expectations. The company posted an EPS of $0.66, outperforming forecasts, while revenue reached $21.3 million, marking a 7% increase year-over-year. Following the announcement, CXI’s stock experienced a modest increase of 0.3% in after-hours trading. According to InvestingPro analysis, the company maintains a GOOD financial health score of 2.82, though current trading levels suggest the stock is slightly overvalued based on Fair Value calculations.

Key Takeaways

• CXI’s Q3 2025 EPS exceeded forecasts, coming in at $0.66.
• Revenue grew by 7% year-over-year, reaching $21.3 million.
• The company’s stock price rose by 0.3% in after-hours trading.
• Payments revenue surged by 24%, contributing significantly to the overall growth.
• CXI is discontinuing its Exchange Bank of Canada operations to focus on the U.S. market.

Company Performance

Currency Exchange International demonstrated solid performance in Q3 2025, with net income rising by 8% year-over-year to $4.2 million. The company’s strategic focus on expanding its OnlineFX platform and adding new airport agents has bolstered its market presence, servicing 90-95% of the U.S. population online. Despite increased operating expenses, CXI’s EBITDA grew by 4% to $8 million, showcasing operational efficiency. The company maintains impressive margins with a gross profit margin of 99.31% and trades at a P/E ratio of 50.05x, reflecting investor confidence in its growth potential.

Financial Highlights

• Revenue: $21.3 million, a 7% increase year-over-year
• Net income: $4.2 million, an 8% increase year-over-year
• Operating expenses: $13.1 million, an 8% increase year-over-year
• EBITDA: $8 million, a 4% increase year-over-year

Earnings vs. Forecast

Currency Exchange International’s Q3 2025 EPS of $0.66 exceeded forecasts, demonstrating the company’s ability to outperform market expectations. The revenue of $21.3 million also surpassed projections, reflecting a strong quarter driven by growth in payments and banknotes revenue.

Market Reaction

Following the earnings announcement, CXI’s stock price increased by 0.3%, reflecting positive investor sentiment. The stock’s performance remains within its 52-week range, with a recent close at $23.2. The modest price movement indicates a stable market response to the earnings beat. InvestingPro analysis reveals two important tips: the stock’s RSI suggests overbought territory, and the company has demonstrated strong returns over the past five years. Subscribers can access 5 additional exclusive ProTips and comprehensive financial metrics for deeper analysis.

Outlook & Guidance

Looking ahead, CXI is focusing on expanding its presence in the U.S. market exclusively in fiscal 2026. The company plans to grow its revenue through consumer and wholesale channels, with potential income from software licensing fees. CXI is also exploring mergers and acquisitions to enhance its market position.

Executive Commentary

Randolph Pinna, CEO of CXI, emphasized the company’s strategic focus, stating, "We will be focusing for the fiscal 2026 year on continuing to grow our revenues while also focusing on efficiency." He also highlighted the potential for new fee income, noting, "We expect in 2026 that we will be seeing a noticeable new fee income from software licensing."

Risks and Challenges

• Market Saturation: As CXI focuses on the U.S. market, it may face increased competition and market saturation.
• Economic Uncertainty: Global economic conditions could impact trading volumes and consumer demand.
• Regulatory Changes: Potential changes in financial regulations could affect CXI’s operations and profitability.
• Technological Advancements: Keeping pace with technological advancements is crucial for maintaining competitive advantage.
• Currency Fluctuations: Volatility in currency exchange rates could impact revenue and profitability.

Q&A

During the earnings call, analysts inquired about CXI’s referral agreements with a Toronto financial institution, the impact of stablecoins on the foreign exchange market, and potential NASDAQ listing considerations. The company addressed these concerns, providing insights into its strategic initiatives and market positioning.

Full transcript - Currency Exchange International Corp (CXI) Q3 2025:

Conference Operator: Good morning, ladies and gentlemen, and welcome to the Currency Exchange International Q3 2025 Financial Results Conference call. At this time, all participant lines are in the listen-only mode. Following the presentation, we will conduct a question-and-answer session. If at any time during this call you require immediate assistance, please press star zero for the operator. Also note that this call is being recorded on Thursday, September 11, 2025. I would now like to turn the conference over to Bill Mitoulas, Investor Relations. Please go ahead, sir.

Bill Mitoulas, Investor Relations, Currency Exchange International: Thank you, Operator. Good morning, everyone. Welcome to the Currency Exchange International conference call to discuss the financial results for the third quarter of the 2025 fiscal year. Thanks for joining us. With us today are President and CEO Randolph Pinna and Group CFO Gerhard Barnard. Gerhard will provide an overview of CXI’s financial results and his latest perspective on the company’s operations. Randolph will then provide his commentary on CXI’s strategic initiatives, sales efforts, and business activities, after which we’ll open it up for your questions. Today’s conference call is open to shareholders, prospective shareholders, and members of the investment community, including the media. For those of you who may happen to leave this call before its conclusion, please be advised that this conference call will be recorded and then uploaded to CXI’s Investor Relations website page, along with financial statements and MD&A.

Please note that this conference call will include forward-looking information, which is based on a number of assumptions, and actual results could differ materially. Please refer to our financial statements and MD&A reports for more information about the factors that could cause these different results and the assumptions that we have made. With that, I’ll turn the call over to Gerhard. Gerhard, please go ahead.

Gerhard Barnard, Group CFO, Currency Exchange International: Thank you, Bill, and thank you everyone for joining today’s call. These results are presented in U.S. dollars, and my overview of the company, CXI, will also incorporate the results of the discontinued operations of Exchange Bank of Canada. As a reminder, on February 18, 2025, the Group announced its decision to cease the operations of its wholly owned subsidiary, Exchange Bank of Canada. All customer activity is ceased as planned by the end of August 2025, and preparation for administration and financial statement year-end audits are underway to submit an application to the Minister of Finance in Canada to discontinue Exchange Bank of Canada from the bank debt. The application to discontinue is expected to be made in the fourth quarter of 2025, with the actual discontinuance of the bank being subject to receipt of all necessary regulatory approvals.

Starting in the second quarter of 2025 and following the Board’s decision to discontinue the bank’s operations, the Group updated its financial statements preparation and presentation to present continuing and discontinuing operations separately in accordance with IFRS accounting standards. Therefore, included in the Group’s financial statements are the results of the United States operations under continuing operations and the results of Exchange Bank of Canada under discontinuing operations. Now, the Group reported net income of $4.2 million for the third quarter, 8% higher than the prior year, and this reflects net income of $5.2 million from continuing operations and a net loss of $1 million from Exchange Bank of Canada. These third-quarter results included a net restructuring credit of about $100,000 related to discontinued operations in Canada.

Now, management anticipates that certain operating expenses and personnel costs that are currently shared with EBC will be 100% borne by CXI after EBC’s exit from Canada, and the current annualized estimated cost would be approximately $3 million after tax. This estimate is subject to change throughout EBC’s discontinuance process. Before we go into the results, I’d like to note that the Group measures and evaluates its performance using several financial metrics and measures, some of which do not have standardized meanings under Generally Accepted Accounting Principles (GAAP) and may not be comparable to other companies. We call these measures non-GAAP financial measures and/or adjusted results. Management believes that these measures are more reflective of its operating results and provide a better understanding of management’s perspective on performance. These measures enhance the comparability of our financial performance for the current period with the corresponding period in 2024.

Management included a full reconciliation of the key performance and non-GAAP financial measures in the MD&A. When we refer to reported results, we refer to the results reported in the financial statements based on IFRS, and when we refer to adjusted results, such as adjusted net income, we refer to performance of non-GAAP measures. With that, here is a summary of the third quarter’s results, comparing this year’s third quarter to the prior year’s third quarter. Revenue grew to $21.3 million by roughly $1.3 million or 7%. Operating expenses increased to $13.1 million or just under a million dollars, close to 8%. Our EBITDA grew to $8 million by $0.3 million or roughly 4% over last year. Reported Group net income grew to $4.2 million by $0.3 million or 8%. That’s an important one. Net income grew to $4.2 million by roughly $0.3 million or 8%.

Adjusted Group net income was half a million or 10% lower than last year due to EBC’s revenue tapering during the current quarter as a result of the discontinuance of its operations. Let’s look at the consolidated performance of the third quarter of 2025 compared to the prior year’s quarter. Our revenue growth was driven by 24% growth in the payments product line and 4% growth in the banknotes revenue, primarily through direct-to-consumer channels. Wholesale banknotes grew roughly a quarter of a million dollars or 3% and represents 44% of the total revenue. While trading volumes declined due to a weaker consumer demand for foreign currencies, this product line grew 4% over the last year due to the continued addition of new domestic financial institution customers in addition to certain large customer transactions at the end of the quarter.

Direct-to-consumer banknotes grew roughly $0.4 million or 5%, and this represents 40% of our total revenue, with growth coming mainly from the OnlineFX platform due to increased demand for exotic and foreign currencies and the addition of 138 new airport agents in various locations. Our payments revenue grew $650,000 or 24%, now almost 16% of our total revenue. The growth was supported by a 30% increase in trading volume activity for existing financial institution customers and the onboarding of new customers. Following is a highlight of operating expenses from continuing operations for the third quarter of 2025 compared to the same quarter last year. CXI’s operating expenses increased about $920,000 or 8% compared to the same period in the prior year.

Variable costs, mostly our cost of goods sold, postage, shipping, bank charges, sales commission, and incentive compensation totaled roughly $3.3 million, a 4% decrease compared to the $3.5 million of the prior year. Salaries and wages increased, mostly driven by Doodle Vault staff growth and the addition of company-owned branch locations in addition to general inflationary increases. Legal and professional expenses increased due to audit and tax services, as well as other legal and advisory services provided in the normal course of business. Marketing and publicity increased as CXI continued to focus on marketing initiatives, campaigns, retail investments, and establishing a customer referral program that supports corporate goals with a focus on the direct-to-consumer business growth. Net foreign exchange losses for the current quarter were primarily driven by hedging costs, and foreign exchange losses in the prior quarter were associated with CXI’s banknote holdings in the Mexican pesos.

Bank service charges are primarily driven by the payments product line. In the current quarter, CXI continued to process certain payment transactions via EBC’s correspondent bank and received a chargeback allocated via intercompany allocations. It is important to remind that intercompany allocations are excluded from the results of continuing operations as per IFRS 5. It is relevant to mention that CXI’s payment processing has fully migrated away from EBC’s correspondent bank during August 2025. Stock-based compensation includes a non-cash amortization expense related to the vesting of the company’s equity-based stock options, in addition to certain cash-based rewards represented by RSUs and DSUs. CXI incurred a net expense in the amount of $73,000 related to DSUs and RSUs, which is lower when compared to about $185,000 for the same quarter last year as a result of the decline in the stock price in the current quarter compared to the previous quarter.

Interest expense decreased as a result of the decline in the average borrowing of funding EBC’s operations and working capital requirements, and it’s tapering significantly following the decision to discontinue operations in Canada. Average outstanding borrowings for the quarter were about $1.3 million compared to $2.1 million during the same quarter last year. The average interest rate is also decreasing, and it was 6.7% compared to 7.7%. Income tax expense in the current quarter represents taxable income growth over the prior year and reflected an effective tax rate of 26%. Summarizing the results of continuing operations for the nine-month period ended July 31, 2025 and 2024. As stated in the beginning of this document, all earnings from continuing operations have been revised to exclude EBC’s results and all associated intercompany transactions.

Now, for the nine months for CXI, the continuing operations, revenue grew to roughly $52.5 million or $2.1 million of growth, roughly 4%. Operating expenses increased to $35.5 million, half a million higher or 1% more than the prior nine-month period. EBITDA grew to $16.7 million, which is about $1.3 million higher than the prior year or 9%. Reported Group net growth, Group net income grew to $7 million, almost $1.7 million or 33% higher, while the adjusted Group net income grew to $7.5 million, about $100,000 or so and 2% higher than the prior year. Deep diving into the nine months ended July 31, 2025, CXI’s payments revenue. Now we’re just going to look at the nine months income statement revenue growth.

Payments for the nine months grew 16% or $1.2 million, with a 27% increase in trading volume activity, where business trading volumes for the nine months were roughly $4.7 billion compared to $3.7 billion in the prior years. Direct-to-consumer and wholesale banknotes combined grew 2% or $940,000, driven by growth in customer demand for certain foreign currencies such as Euro and the Mexican pesos, which offset the declining volumes from other currencies such as the Canadian dollar. During the current year, that’s the nine months, CXI added 192 new non-airport agents and two new states to the OnlineFX platform, reflecting increased volumes from exotic currencies. The Group reported net income of $7 million. This is for the nine months again, including the results from discontinued operations compared to $5.3 million for the same period last year.

This included net income from continuing operations of roughly $9.6 million compared to $9.9 million from the same period last year. As I mentioned, the Group had an adjusted net income of $7.5 million in the current nine-month period, 2% higher than the prior year. Now, looking at the results of discontinued operations, and again, this relates to Exchange Bank of Canada, the bank had a net loss of $1 million in the third quarter compared to a net loss of roughly $1.2 million for the same period in the prior year. For the nine months ended July 31, 2025, the bank had a net loss of $2.6 million compared to last year’s $4.6 million in the same period.

Diluted loss per share from discontinued operations was a loss of $0.17 for the third quarter and a loss of $0.41 for the nine months ending, compared to roughly $0.18 and $0.70 in the same periods last year. The application to discontinue is expected to be made in the fourth quarter of 2025, with the actual discontinuance of the bank being subject to receipt of all necessary regulatory approvals. Now, reviewing the balance sheet as at July 31, 2025, due to the company’s business being subject to seasonality, CXI is using a trailing 12-month net income amount to calculate ROE, which was a consistent 12% over the last 12 months, and it includes the discontinued operations results. Now, CXI has net working capital of $67 million and total equity of $84 million, and a 100% available unused line of credit totaling $40 million. All debts were paid.

Maximizing the return on capital to our shareholders through share buybacks remained a key focus. During the nine-month period ended July 31, 2025, the Group purchased for cancellation 190,300 common shares at the normal market prices trading on the TSX for roughly $2.85 million under its second share buyback program or normal course issuer bid. On August 20, the Group announced a retroactive increase in its second NCIB. The Board of Directors and Management believe that the market price of the common shares may not, from time to time, fully reflect the long-term value of CXI. Between August 1 of this year and September 10, yesterday, the Group had purchased for cancellation an additional 92,100 shares for a total of about $1.4 million. Our total repurchased shares through to September 10 is now 282,400 common shares, equivalent to roughly $4.25 million US dollars.

Now, at this time, I will turn the call over to Randolph Pinna, our CEO, for his perspective. Thank you, Randolph.

Randolph Pinna, President and CEO, Currency Exchange International: Thank you, Gerhard, and thank you all on the call. I appreciate everybody being available, especially those out west who are up early in the morning. As usual, I’d like to start with EBC. I think you’ve heard clearly, we are in the final stretch of our discontinuance according to our approved discontinuance plan. It was a sad day to see the last transactions here in Toronto, where I sit right now. We are in the final phase of completely exiting Canada. I’m sitting in the EBC office, which is mostly vacant, and this month will be the last month that staff are in this office as whatever staff is remaining will be working from home as we discontinue Exchange Bank of Canada. We will be filing, as mentioned, this year, and we will then be waiting for regulatory approval.

Moving to CXI, as you can imagine, with no longer having a wholly owned subsidiary bank, we are in the final phase of updating our strategic plan for the next three to five years. In this process, we actually have gone out and recruited the voice of over 1,000 U.S. consumers to get the voice of the consumer, whether they want to exchange money at their bank, at a Bureau de Change, at an airport, or what have you. We also did a deep dive and got the voice of our customer, not just to banks and financial institutions, but also our agent customers and other customers to understand the customer’s needs and goals for the next three to five years as well.

Lastly, we have done quite a few meetings with our shareholders, and we do have that incorporated in our strategic plan as well, the voice of our shareholder. We’re going to focus for the fiscal 2026 year on continuing to grow our revenues while also focusing on efficiency, utilizing automation and simplification efforts. We hope that the 2026 year will be a clean year. It won’t have all the noise of continuing and discontinuing, and we are excited to embark on our new fiscal year with our updated strategic plan. On the actual business itself, as you see, we are continuing to grow in our consumer area with our online store, with the new states. We’re now well over 90% of the entire U.S. population can be serviced through their home and office should they not want to visit their bank or their CXI locations.

We are continuing to selectively add company-owned and operated retail stores. The new market in the new store in Phoenix, Scottsdale, Arizona has opened and is doing very well. We’re adding another location in New York, and we will continue to add selective locations each year. Most importantly, our agent program, as you see, is continuing to grow. We really enjoy the agent relationship. It is a win-win-win situation for all involved, and we will continue to focus on our agents. Overall, our consumer business is healthy. We feel there’s a lot more growth both in the online agent and physical stores by adding additional products and services, utilizing the same infrastructure in place. Moving to the wholesale business, we will continue to always focus on selling banknotes to financial institutions. That is both banks and credit unions, but we are also complementarily selling the payment product.

As you can see, we continue to invest our sales efforts and successfully add new locations to continue to allow our payment business to diversify our total group revenues. Lastly, I wanted to just talk about M&A. Gerhard and I have been quite busy reviewing and investigating opportunities that are strategic and would be accretive to the company. There’s nothing imminent. However, we are continuing to explore and always looking for an opportunity that will complement our business and accelerate our growth. That’s all I have for the MyMini update, and I thought the best thing now would be to open it up for questions that Gerhard and I can answer for you. Thank you.

Conference Operator: Thank you, Mr. Pinna. Ladies and gentlemen, if you do have any questions at this time, please press star followed by one on your touchtone phone. You will then hear a prompt that your hand has been raised. Should you wish to decline from the polling process, please press star followed by two. If you’re using a speakerphone, you will need to lift the handset first before pressing any keys. Please go ahead and press star one now if you have any questions. First, we will hear from Robin Cornwell at Catalyst Equity Research. Please go ahead, Robin.

Robin Cornwell, Analyst, Catalyst Equity Research: Thank you, and good morning. I wondered if I could ask the first question. If you could expand on the EBC referral agreements, you indicated that it’s over a four-year term. I wondered if you could give us some idea whether it’s in a material amount you’d be expecting and what kind of potential income that might be generated from that.

Randolph Pinna, President and CEO, Currency Exchange International: Thank you, Robin. I appreciate the question. We have two referral agreements in place, one with a financial institution here in Toronto that is focused on the wholesale banknote business. We have not yet received the first report from that company, although I have heard they seem to be doing well. We do not predict or forecast future earnings. As you know, we don’t give guidance, and I don’t have an estimate to provide to you, but I do confirm that the existing banknote referral agreement with the Toronto institution is in place and customers have migrated to them. We will know more as it is reported in our next quarterly report, which I don’t think will be highlighted as a separate line item. To be a separate line item, it would need to be more than 10% of total revenue, so it will not be that large.

You will see additional fee income from that. The second referral agreement is with a money service business based in Vancouver to take over payment clients. This is not expected to be as material as the banknotes since only three employees and their quote "book of customers" migrated to the new company, so that referral agreement would be less material indeed. That is all I can comment on the referral agreements. Did that hopefully help answer the question?

Robin Cornwell, Analyst, Catalyst Equity Research: Okay, thank you. One little quick question. The payments revenue was up, you know, quite significantly. Had any of that volume, was it related to tariffs and the, you know, the front ending of imports and things like that into the United States? Could you comment on that?

Randolph Pinna, President and CEO, Currency Exchange International: I don’t know the direct impact of any tariff activity. I do know that the tariff activity has reduced foreign demand to come to America. As far as payment revenue, it has, I don’t think, had a material impact on it. Our payment growth increases because we’re continuing to add new clients as a result of the integrations we’ve done with the software providers that run bank software systems. The growth that you’re seeing is real growth from new and existing relationships. I don’t have any insight into whether some of that is because of pre-buying of the tariffs. I don’t believe it is.

Robin Cornwell, Analyst, Catalyst Equity Research: Okay, thank you. Randolph, one more, yes?

Gerhard Barnard, Group CFO, Currency Exchange International: Hello.

Randolph Pinna, President and CEO, Currency Exchange International: Robin, maybe to comment on that point, as Randolph mentioned, we saw that about $0.5 million of that growth, or let’s say close to two-thirds, was by adding new customers. That just creates an annuity stream for us. Existing customers also grew in this payment space that we have. You saw the volumes continue to tick up, the additional payments that we do. You look at those billions of dollars of money that we move, that gives you a good sense of payments current velocity.

Robin Cornwell, Analyst, Catalyst Equity Research: Oh, terrific. Okay, thank you for that extra thought. Randolph, I do have one question for you, and it’s a broader-based question. It’s planning or how you plan to grow perhaps the software-as-a-service capabilities because you’ve invested a tremendous amount of money in the SaaS and you’re using it now. Do you have any more insights as to where you might drive your business with the software?

Randolph Pinna, President and CEO, Currency Exchange International: Thank you for that question. Just as for the whole audience, we’re going to try to limit questions to two per person. I’m happy to do this third one, Robin, but if there are more, please reach out just out of respect for the other people on the call. Yes, I’m very excited about the fact that we have got past our pilot where we have some clients paying a fee to utilize the software since it is true payment rails for both foreign currency wires as well as U.S. dollar wires. We expect in 2026 that we will be seeing a noticeable new fee income from software licensing as opposed to our current model of where our banks get our software in return for doing their wires with us. We are pivoting that way where we are going to be seeing additional income from our software as a service.

I can’t forecast what that number is, but I do confirm that, one, you’re right, we have invested and built out an excellent system for both foreign currency and U.S. dollar wires. This is being sought by quite a few banking companies, lots of which are customers using banknote services. We have a captive audience to continue to expand this business line.

Robin Cornwell, Analyst, Catalyst Equity Research: Okay, thank you very much for the insight.

Randolph Pinna, President and CEO, Currency Exchange International: Thank you.

Conference Operator: Next question will be from Peter Rabova at Article Capital. Please go ahead, Peter.

Bill Mitoulas, Investor Relations, Currency Exchange International: Hey guys, thanks for taking my call. I have a big one for you, Randolph, and then I have a housekeeping one for Gerhard. Maybe now that you’re kind of unencumbered from Canada, could you just talk about the big drivers and kind of give a scorecard of your business as it stands today, the U.S. business, and you know, what’s it most sensitive to and what are you seeing out there? Just the conditions. Thanks.

Randolph Pinna, President and CEO, Currency Exchange International: Thank you, Peter. First of all, yes, it feels good to not be having spent as much time in Canada, which will be going down to zero soon. That allows me 100% focus on our overall business in the U.S. As I said, with the updating of the strategic plan, it is focused on our core areas of expanding our relationships with financial institutions across the U.S. for both banknotes and payments. As I was just telling Robin, our payments business line will continue to grow with additional new clients as well as software-as-a-service fee income. In the actual currency exchange business, as I had said earlier, we see a lot of opportunity online. We feel that the fact that we can service 90% to 95% of the whole U.S.

population, we will be continuing to invest into marketing and growing our online presence and selectively opening new stores with possibly a new service that could add fee income. We are very focused on our agents. We see that as winning a large national retail chain. Adding the new service of currency exchange will be significant for us. As I said, the wholesale business will continue to grow because of the new customers we add and the expansion and diversification of the payment revenue. Lastly, we are looking and have identified opportunities, but again, we will only do a transaction if it’s accretive and in line to our existing business. The voice of the shareholder revealed that one or two shareholders just basically want to stay focused on our core business and not quote unquote chase a shiny object.

You will see that the next three years will allow for a clean business here in the U.S., and that growth in revenue will come from both the consumer channel as well as our wholesale channel. Peter, is that what you were looking for or was there anything further?

Bill Mitoulas, Investor Relations, Currency Exchange International: I definitely appreciate the color of what the business drivers are. I was actually asking more on what’s going on today, what you’re seeing in the macroeconomic kind of competitive conditions. This was just as good. I have one more small question to Gerhard, but if you want to answer my other question.

Randolph Pinna, President and CEO, Currency Exchange International: Yeah, Peter, I can’t forecast what the tariffs are doing or people getting shot in America and what international visitors are thinking of America right now. I can’t guess at what the year ahead will be from a macro level. We just know that our focus is we have a valuable service to potential clients. We have a good revenue stream with a lot of expenses supporting that. We feel that we continue to double down on our sales and adding new clients, all while Gerhard and the entire company focus on efficiency through internal automation and even elimination of certain items now that we’re no longer a bank group. No longer having that bank group structure will allow for improved efficiency in our current business in the United States. That’s the macro comment.

Bill Mitoulas, Investor Relations, Currency Exchange International: Okay, thanks. My follow-up is on the cash. On the cash line, there’s a $12 million line of cash to be paid to shareholders. Is that basically the release of funds of the cash that was held by the bank back to the group, that would be more available to you that wasn’t available in the past? Is that the way to read that?

Gerhard Barnard, Group CFO, Currency Exchange International: You’re referring to page 18 of the financial statements. That 18 is definitely a portion of it because we have to be reminded that this is as at the end of July 2025. We’ve still got months of business to run. As I mentioned, we’ve repaid intercompany loan accounts. We have lower working capital requirements. If you look at that number, you have to consider the fact that there are various other items that have to be run through the cash mole, if I can call it that, until the end of the year. We are still heading towards a repatriation of some capital at the end of the year and the full once the working capital decreases to close to zero as the bank continues its discontinuance.

Bill Mitoulas, Investor Relations, Currency Exchange International: Okay, I mean, that’s great. I just want to be clear, the way to read that is that that cash was not available because it was held by a bank as part of capital requirements. Now, whatever that number will end up being, it is more available to you to use for acquisition and share buybacks.

Gerhard Barnard, Group CFO, Currency Exchange International: Absolutely right. Yes. Obviously, take out working capital, take out intercompany transactions, and then just running the bank for the next three months. Yes, you’re on the right track.

Bill Mitoulas, Investor Relations, Currency Exchange International: Okay, great. I’ll let somebody else hop on. If not, I’ll ask one more question afterwards. Thanks.

Conference Operator: Thank you. Once again, ladies and gentlemen, if you do have any questions, please press star followed by one on your touchtone phone. Next, we will hear from Steven Renzini at University Bank. Please go ahead, Steven.

Steven Renzini, Analyst, University Bank: Good morning. Can you hear me?

Speaker 6: Yes, Steven, I do. Good morning.

Steven Renzini, Analyst, University Bank: Super. Good morning, guys. First of all, congratulations on a pretty good quarter operationally in the United States. We’re very happy with our investment in CXI, you know, because of the good job that you are doing. We’ve increased our ownership to 12.44% at a cost of less than book value. I was very pleased to see the increase in book value. My question relates to the discontinuance of the bank in Canada, and it had some licenses, particularly with the New York Federal Reserve that you guys had been utilizing for the whole business. How are you going to handle those things now that you don’t have a Canadian bank to help you gain access to it? Are you losing any functionality? Do you have plans to replace that functionality? What are you doing? Will it have any other follow-on impacts?

Randolph Pinna, President and CEO, Currency Exchange International: Thanks. Thank you, Steven. Yes, I want to just point out that the Exchange Bank of Canada relationship with the Federal Reserve Bank of New York through the FedDirect program is completely ceased. We have closed our accounts with the Federal Reserve, but that business did not help CXI whatsoever because the license that we had with the Federal Reserve prohibited Exchange Bank of Canada to sell or buy U.S. dollars in America. CXI had zero benefit from that. We, of course, as a group, established a relationship, and I am very proud to tell you that our payment business is a part of the Federal Reserve FedDirect program, and therefore it has enabled our payment business to be more attractive to U.S. financial institutions.

As you can already see, the payment revenue growth is well underway, and as one of the previous questions alluded to, there’s a lot of opportunity in the 2026 year. The other capability that Exchange Bank of Canada provided us was that CXI processed the majority of its wires through Exchange Bank of Canada, and hence its correspondent relationship. As Gerhard Barnard mentioned in his commentary, we have totally migrated all of that activity away from Exchange Bank of Canada as a part of our discontinuance plan, and that is currently being processed by two U.S. financial institutions with their global network. We are always looking for additional strategic relationships. The Fed relationship at Exchange Bank of Canada was in a specific wholesale banknote business product, which was bulk U.S. dollars and, of course, other foreign currencies selling.

We have exited that business line in Canada, and CXI is not replicating international bulk U.S. dollar activity globally. While we do have some select relationships that are international based in our Florida office, that is not the same as what Exchange Bank of Canada was doing with banks that we had in France, in the U.K., in Switzerland, and so forth. That wholesale banknote business will not be replicated, at least in the next year or two at CXI. Did that answer your question, Steven?

Steven Renzini, Analyst, University Bank: Yes, completely. Thank you, Randolph. My follow-up question, second and final question, is with respect to Crown Agents Bank. You had mentioned previously that you’re working on setting up some relationships with them. How’s that going? What functionality are you gaining from that? Has there been progress volumes? Is this helping your business yet or not? Do you think it’ll be material in the future or not?

Randolph Pinna, President and CEO, Currency Exchange International: As I said, we are always looking to have strong strategic banking relationships. Crown Agents Bank’s specialty is with exotic currencies around the world, which is not a top wire that we do. We do have a relationship with them, but there are limitations to their capabilities. The two primary U.S.-based financial institutions that are currently our wholesale correspondent bank have been sufficient. We do, I would call it, cherry-pick with Crown Agents as they do have some strengths that are attractive to payment providers like ourselves. We do work with them some, but not as much as I would think we could have done because of some of their limitations.

Steven Renzini, Analyst, University Bank: Super. Thanks so much. Again, keep up the good work.

Randolph Pinna, President and CEO, Currency Exchange International: Thank you, Steven. Thank you for your support.

Conference Operator: Next question will be from Jim Byrne at Acumen Capital. Please go ahead, Jim.

Jim Byrne, Analyst, Acumen Capital: Good morning, guys. I just wanted to clarify on the expenses. When I see the run rate from this quarter, continuing operations, is that what we should expect going forward, obviously given seasonality? I just wanted to clarify given your comments about that $3 million in expenses that will be absorbed. I just want to make sure that that has been absorbed in this quarter.

Gerhard Barnard, Group CFO, Currency Exchange International: Jim, good question. As we stated, continuing operations excludes currently any intercompany transactions. If you look at the stranded cost that we are reporting, it would probably be $3 million after tax. That consists of roughly 40% as bank charges, of course, the correspondent relationship we had with Exchange Bank of Canada, and we have fully migrated that relationship in the middle of August to Currency Exchange International. In the fourth quarter, pretty much half of all the bank charges will actually be in continuing operations. 40% of stranded cost is bank charges, 40% of stranded cost is basically salaries and wages as we’re paying the 100% portions, the non-100% portions of the FDE. Then we’ve got about a quarter of computer and systems insurance and licenses.

What you see right now with continued and discontinued operations is not fully incorporating all the stranded costs because there were still expenses running through Exchange Bank of Canada that is in discontinued operations. If you look forward, you would probably be able to add about $100,000 to $150,000 a month to our salaries and wages line, which moves you closer to about $2.4 million per month U.S. If you look at bank charges, as I mentioned, 40% of that $3 million after tax will start spilling over to Currency Exchange International as we fully operationalize that new relationship of ours. We are actively, as in management and the board, going through all our various expenses as part of our strategic plan in really mitigating that enhanced cost structure that’s coming through.

Jim Byrne, Analyst, Acumen Capital: Okay, that’s helpful. Just as a follow-up, I wanted to just double-check on your IT spend. It’s come down, and is that again kind of the continuing run rate that we should expect?

Gerhard Barnard, Group CFO, Currency Exchange International: IT spend is, you know, constantly depending on the systems and any additional pushes that we do. I would not predict that or I would not determine that what you currently see is the run rate going forward. IT is extremely important to us as well as our cybersecurity, and we continue to invest in it. Not an increase, but don’t see a decreasing run rate in IT. As we know, our payments business is growing, our volumes are growing, and IT, you know, for us is a strategic driver with OnlineFX platform and so forth. That is one item that we are comfortable to make the necessary capital investments in to continue to grow our business.

Randolph Pinna, President and CEO, Currency Exchange International: I can confirm that we have a very well-structured IT department. Our Senior Vice President, Paul Ohme, has ensured that we have a fully capable team. We won’t be hiring any new IT gurus or anything like that. I think what Gerhard’s trying to show you is that while we will continue to do integrations and so forth, we have a pretty fixed cost structure in IT, and we are not going to be hiring any additional people in IT that would significantly increase that. Because the banks close, it doesn’t mean you’ll see a big reduction in IT because our cybersecurity is always a focus. We have a pretty consistent IT team now, and I don’t think there’ll be any radical changes either direction.

Gerhard Barnard, Group CFO, Currency Exchange International: Yeah, and Jim, maybe just to complement that point, if you really go through our operating expenses, you’ll see that IT is either we hold it fairly stable. If I look at the nine months, it’s about $100,000 higher than the prior nine months. If you look at the quarter, you can say depending on one or two things that we’ve specifically done in this quarter, it might be $50,000 to $100,000 higher than the prior quarter. That’s $731,000 for the three months ending July versus $517,000 for the prior year on page 31. I would say our quarterly three-quarters of a million gives you a fair indication of the future projections, you know, taking staff increases and inflation and so forth into account.

Bill Mitoulas, Investor Relations, Currency Exchange International: Okay, thank you.

Conference Operator: Next question will be from Yale Block at Y Agency Investment. Please go ahead, Yale.

Robin Cornwell, Analyst, Catalyst Equity Research: Good morning, guys. Two questions. First, regarding the agent relationships, there was a dramatic increase in, I guess, the AAA. If you could just provide a little color on duty-free and maybe with the cruise industry, there was an announcement of a partnership. The second one is your thoughts on the Genius Act and stablecoins and potentially how that might impact the foreign exchange market over time and how you’re thinking about it. Thanks.

Randolph Pinna, President and CEO, Currency Exchange International: Okay, thank you, Yale. Good to hear from you. To begin with, the agent growth that has because of the AAA relationship continues to grow. If you’re familiar with the AAA structure, they have their "clubs" in each market. The nice thing is there’s still several clubs that are not under our umbrella. However, CXI and AAA headquarters have a strong relationship, and it is encouraged that all clubs migrate to CXI. You will continue to see that. Duty-free is still a good customer. Unfortunately, because of the challenges that that business has had, it has not afforded the attention required for us to add all of their southern locations. We do hope that in fiscal 2026, we will be adding their locations down south.

We are always looking for additional agent relationships, especially ideally with a national provider, a national retailer that has good real estate and a good audience but does not offer currency exchange. We are going to continue to focus on that. On the payment side, we have spent quite a bit of time keeping up with the change with stablecoins. From a practicality, we’re banks, our customers that are moving their customers, corporations, money around the world. We don’t see that there will be, in the next three to five years, a material impact on foreign wire transfers. We’re seeing the stablecoin being a U.S. dollar-centric push. Whether how fast the adoption rate goes to stablecoins or even broader crypto activity is unknown.

We still are tapping into existing flows of payments, and we feel that there is a lot of upside potential in our current payment model, which does not incorporate utilizing a stablecoin.

Robin Cornwell, Analyst, Catalyst Equity Research: Okay, very good. Thank you very much.

Randolph Pinna, President and CEO, Currency Exchange International: Thank you, Yale.

Conference Operator: Next is a follow-up from Peter Rabova at Article Capital. Please go ahead, Peter.

Steven Renzini, Analyst, University Bank: Hey guys, one of my questions was answered on the $3 million and whether that was absorbed. I guess I’ll ask a question. I know you won’t really be able to answer the way I would ask it. Now that you’re a mostly U.S.-based company, would you, or soon will be, would you say it’s inefficient for the stock to be traded on a Canadian exchange?

Randolph Pinna, President and CEO, Currency Exchange International: One, I confirm in fiscal 2026, we will be only a U.S.-based company. Regardless, even if for some reason that our bank did not get the final regulatory approval, as I said, our lease here, and I’m sitting in Toronto, our lease here ends October 31, 2025. We will be actually exiting the building sooner than that. We are basically going to have a clean empty shell that will be audited at fiscal year end, and that will be the crux of supporting the application to discontinue. In 2026, we will be a U.S. company only and not a bank group. As far as our Toronto Stock Exchange listing, the Ontario Securities Commission and the TSX have been a very good solid market for us. We have a large Canadian shareholder base. We do recognize we have also a good U.S. shareholder base.

NASDAQ is being evaluated as far as what additional costs and increased regulatory concerns because the SEC, we imagine, is much heavier than the OSC. It is not a plan to move right away to NASDAQ, but it is being explored as an alternative to where our stock trades. Right now, because of our upgrade on the OTC market, we have seen an improvement and reaction from some U.S. shareholders. That is good, a step. I believe where you’re headed with this is, you know, you think we should be on NASDAQ, and we would consider it. Right now, I’ve asked our team to evaluate the total cost structure, not only just the listing fees, but the legal implications of that, as well as other costs, like director and officer liability costs go up.

We have to do a wholesome review of the costs relative to the reward of being on the bigger exchange.

Steven Renzini, Analyst, University Bank: Okay, I think you know how I feel. I think the reward’s pretty good if you, you know, but especially for a company as undervalued as you. I appreciate at least the consideration of it. Thanks again for taking your time.

Randolph Pinna, President and CEO, Currency Exchange International: No problem, Peter. We understand, and you know, it’d be nice if we did. It got big enough to be on the Russell 2000 and so forth. We do see the upside, but it is only prudent of us as the guidance of our company and all of our shareholder money. We want to ensure that we understand the full cost and ramifications of a potential stock market switch.

Steven Renzini, Analyst, University Bank: Thank you.

Randolph Pinna, President and CEO, Currency Exchange International: Thank you.

Conference Operator: Next is a follow-up from Steven Renzini at University Bank. Please go ahead, Steven.

Steven Renzini, Analyst, University Bank: Yes, the last question prompted me to make a follow-up. I would encourage you to discontinue the Canadian filings and go and stay on the OTCQX. You know, we’re also on the OTC markets. Our bank holding company is not in the OTC markets. We’re symbol UNIB. Every investment bank that I talk to, every institutional investor that I talk to says that SEC registration, and in our company history, we were SEC registered at one point for, you know, well over a decade, isn’t a good idea unless you’re able to be in the Russell 2000 index. You spend a significant sum of money doing all the SEC filings, but the market being made in NASDAQ versus the market being made in the OTCQX, in your case, is not materially different according to investment banks.

It’s only if you get to the Russell 2000 that the full benefit of being on NASDAQ is actually unleashed. I don’t know if you have any reaction to that, but that’s the advice that I’m getting.

Randolph Pinna, President and CEO, Currency Exchange International: Thank you, Steven. As I just told Peter, that is why we need to take a holistic view. We need to understand all the costs and all the benefits so that the board and I can make a final decision. We appreciate that feedback, and I do confirm it is something that is on our radar to consider. That is why we did upgrade on the OTCQX, and we’re comfortable where we sit now. However, being fully American, it does indicate or imply that you should probably be on an American exchange fully. We will consider that, and it will be discussed in the upcoming board meetings.

Conference Operator: Thank you. At this time, gentlemen, we have no other questions registered. Please proceed.

Randolph Pinna, President and CEO, Currency Exchange International: Okay, thank you. I just want to thank all of our shareholders for their interest and support of CXI. I want to thank our entire management team. A special call-out for Katie Davis, our Group Treasurer, as well as the Interim CFO of Exchange Bank of Canada, who’s done a fabulous job sticking to our discontinuance plan and ensuring all the many, many, many pieces of completely exiting Canada are done and on time. Real hats off to her. Thank you for that. Again, all the people in Canada that have unfortunately had to find new jobs here, it is a bit of a sad day. Again, I want to give a big thanks to all of us together, both the shareholders and the team, for getting us where we are and having a clear path ahead in the 26 years to come. Thank you.

Conference Operator: Thank you, sir. Ladies and gentlemen, this does indeed conclude your conference call for today. Once again, thank you for attending. At this time, we do ask that you please disconnect your lines. Enjoy the rest of your day.

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