Dealnet Reports Second Consecutive Quarterly Profit

• Second quarter net income of $165 thousand increased by 45% over Q1 profit of $114 thousand
• Call centre maintains high service levels through COVID-19
• Delinquent accounts declined by 8% from March 31
• Further reduction in corporate overheads to less than $1 million per month
• Cash balance of $8.8 million as of June 30 (March 31, 2020 – $4.7 million)
• Originations rebounding strongly

TORONTO, Aug. 14, 2020 (GLOBE NEWSWIRE) -- Dealnet Capital Corp. ("Dealnet" or the "Company") (TSX VENTURE: DLS), reported today its financial results for the quarter ended June 30, 2020. All results are reported under International Financial Reporting Standards ("IFRS") and in Canadian dollars, unless otherwise specified.

Net income of $279 thousand in the first half of 2020, an increase of $1.5 million over the results from the same period in 2019. This is a remarkable performance given the current economic climate. Dealnet’s business is strengthening, supported by a foundation that combines a solid, multi-year plan with talented leaders and managers who are demonstrating an ability to execute this plan in the face of a challenging operating environment. The Company continues to be in a strong position and well positioned to take further strategic actions as it executes on its growth strategy.

One Contact and EcoHome Financial Successfully Managing Through COVID-19

One Contact (“OCI”) delivered a profit of $432 thousand for the second quarter of 2020, an increase of 35% over the same period last year, despite significant volume declines at two of its customers and operational challenges related to COVID-19. Many of our call centre competitors have not been as successful in managing through the pandemic, and we would like to acknowledge the dedication and efforts of our OCI teams in Ontario and Nevada.

As COVID-19 hit in mid-March of 2020, we anticipated that there would be a sharp decline in loan originations for EcoHome Financial, due to the temporary closure of our dealers. We are pleased to report not only that originations did not decline as much as we had feared in second quarter 2020, but that they have started to rebound strongly as our dealers re-open.

During the second quarter, interest income stayed constant at $4.7 million and was not negatively affected by COVID-19, due to the high-quality portfolio of long-term loans and leases. In fact, delinquent accounts in the portfolio as of June 30, 2020 were down by 8% from levels seen at March 31, 2020, thanks to the efforts of our very effective collections group. Given that possible impacts from COVID-19 on the economy will take time to fully emerge, these indicators will continue to be monitored very closely as we go forward, but to see these trends at this stage is very encouraging. In the second quarter, Dealnet increased our balance sheet provision for credit losses: