Aecon reports first quarter 2025 results with record backlog of $9.7 billion
Press Release
Toronto, Ontario – April 23, 2025: Aecon Group Inc. (TSX: ARE) (“Aecon” or the “Company”) today reported results for the first quarter of 2025.
With record backlog of $9.7 billion, contributions from strategic acquisitions, solid recurring revenue, and a strong bid pipeline, revenue in 2025 is expected to be stronger than 2024,” said Jean-Louis Servranckx, President and Chief Executive Officer, Aecon Group Inc. “Aecon continues to maintain a disciplined capital allocation approach to deliver long-term shareholder value through acquisitions and divestitures, organic growth, dividends, capital investments, and common share buybacks on an opportunistic basis.”
HIGHLIGHTS
All quarterly financial information contained in this news release is unaudited.
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Revenue for the three months ended March 31, 2025 of $1,062 million was $215 million, or 25%, higher compared to the same period in 2024.
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Operating loss of $40.7 million for the three months ended March 31, 2025 compared to an operating loss of $4.2 million for the same period in 2024.
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Adjusted EBITDA(1)(2) of $3.6 million for the three months ended March 31, 2025 (Adjusted EBITDA margin(3) of 0.3%) compared to Adjusted EBITDA of $32.9 million (Adjusted EBITDA margin of 3.9%) in the same period in 2024. The decrease in the quarter was largely due to a negative gross profit of $28.6 million on a fixed price legacy project. The fixed price legacy projects are discussed in Section 5 “Recent Developments” and Section 10.2 “Contingencies” in the Company’s March 31, 2025 Management’s Discussion and Analysis (“MD&A”), and Section 13 “Risk Factors” in the 2024 Annual MD&A.
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Loss attributable to shareholders of $37.9 million (diluted loss per share of $0.60) for the three months ended March 31, 2025 compared to loss attributable to shareholders of $6.1 million (diluted loss per share of $0.10) in the same period in 2024.
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Reported backlog at March 31, 2025 of $9,696 million compared to backlog of $6,273 million at March 31, 2024. The March 31, 2025 balance represents the highest reported backlog in the history of Aecon. New contract awards of $4,096 million were booked in the first quarter of 2025 compared to $963 million in the same period in 2024.
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An Aecon joint operation was awarded a collaborative contract by Ontario Power Generation in the fourth quarter of 2024 which includes the definition phase work for the retube, feeder and boiler replacement of Units 5, 6, 7 and 8 at the Pickering Nuclear Generating Station in Ontario. Aecon holds a 50% interest in the joint operation and added approximately $500 million of additional contract scope to its Construction segment backlog in the first quarter of 2025.
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An Aecon-led consortium reached commercial close on the Scarborough Subway Extension Stations, Rail and Systems progressive design-build project. Aecon’s share of the target price contract is valued at over $2.8 billion and was added to backlog in the first quarter of 2025.
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On April 22, 2025, Aecon was recognized as one of Canada’s Greenest Employers by Mediacorp Canada Inc. as a leader in creating an organizational culture of environmental awareness. Aecon also released its sixth annual Sustainability Report, which is available at aecon.com/sustainability.
CONSOLIDATED FINANCIAL HIGHLIGHTS
| Three months ended | ||||||||
| $ millions (except per share amounts) | March 31 | |||||||
| 2025 | 2024 | |||||||
| Revenue |
$
|
1,061.7 |
$
|
846.6 | ||||
| Gross profit | 41.8 | 62.8 | ||||||
| Marketing, general and administrative expense | (56.9) | (52.1) | ||||||
| Income (loss) from projects accounted for using the equity method | (0.4) | 2.3 | ||||||
| Other income | 0.8 | 1.7 | ||||||
| Depreciation and amortization | (26.0) | (18.8) | ||||||
| Operating loss | (40.7) | (4.2) | ||||||
| Finance income | 1.6 | 3.2 | ||||||
| Finance cost | (10.0) | (5.7) | ||||||
| Loss before income taxes | (49.2) | (6.7) | ||||||
| Income tax recovery | 11.1 | 0.6 | ||||||
| Loss | (38.1) | (6.1) | ||||||
| Non-controlling interests | 0.1 | – | ||||||
| Loss attributable to shareholders |
$
|
(37.9) |
$
|
(6.1) | ||||
| Gross profit margin(4) | 3.9% | 7.4% | ||||||
| MG&A as a percent of revenue(4) | 5.4% | 6.2% | ||||||
| Adjusted EBITDA(2) |
$
|
3.6 |
$
|
32.9 | ||||
| Adjusted EBITDA Margin(3) | 0.3% | 3.9% | ||||||
| Operating margin(4) | (3.8)% | (0.5)% | ||||||
| Adjusted loss attributable to shareholders(2) |
$
|
(34.0) |
$
|
(9.0) | ||||
| Loss per share – basic |
$
|
(0.60) |
$
|
(0.10) | ||||
| Loss per share – diluted |
$
|
(0.60) |
$
|
(0.10) | ||||
| Adjusted loss per share – basic(2) |
$
|
(0.54) |
$
|
(0.14) | ||||
| Adjusted loss per share – diluted(2) |
$
|
(0.54) |
$
|
(0.14) | ||||
| Backlog (at end of period) |
$
|
9,696 |
$
|
6,273 | ||||
- This press release presents certain non-GAAP and supplementary financial measures, as well as non-GAAP ratios to assist readers in understanding the Company’s performance (GAAP refers to Canadian Generally Accepted Accounting Principles). Further details on these measures and ratios are included in the “Non-GAAP and Supplementary Financial Measures” and “Reconciliations and Calculations” sections of this press release.
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This is a non-GAAP financial measure. Refer to the “Non-GAAP and Supplementary Financial Measures” and “Reconciliations and Calculations” sections of this press release for more information on each non-GAAP financial measure.
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This is a non-GAAP ratio. Refer to the “Non-GAAP and Supplementary Financial Measures” section of this press release for more information on each non-GAAP ratio.
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This is a supplementary financial measure. Refer to the “Non-GAAP and Supplementary Financial Measures” section of this press release for more information on each supplementary financial measure.
Revenue for the three months ended March 31, 2025 of $1,062 million was $215 million, or 25%, higher compared to the same period in 2024. Revenue was higher in the Construction segment by $214 million driven by increases in nuclear ($125 million), industrial ($65 million), utilities ($15 million), and civil operations ($11 million), partially offset by lower revenue in urban transportation solutions ($2 million). This higher revenue was driven primarily by an increased volume of refurbishment work at nuclear generating stations in Ontario and the U.S., and from a higher volume of field construction work at industrial facilities in western Canada. In the Concessions segment, revenue was lower by $1 million primarily from a decrease in management and development fees related to light rail transit (“LRT”) projects.
Operating loss of $40.7 million for the three months ended March 31, 2025 was unfavourable by $36.5 million compared to an operating loss of $4.2 million in the same period in 2024. The decline in the period was driven by a decrease in gross profit of $21.0 million. In the Construction segment, lower gross profit of $20.6 million resulted primarily from lower gross profit margin in civil operations and urban transportation solutions which more than offset the positive impact of higher volume and gross profit in nuclear, industrial, and utilities operations. The lower gross profit in the first quarter of 2025 in civil operations was impacted primarily by negative gross profit of $28.6 million on a fixed price legacy project and weaker gross profit in civil operations in western Canada. The fixed price legacy projects are discussed in Section 5 “Recent Developments” and Section 10.2 “Contingencies” in the Company’s March 31, 2025 MD&A, and Section 13 “Risk Factors” in the 2024 Annual MD&A. In urban transportation solutions, the decrease in gross profit in the period results from lower gross profit margin from LRT projects as these projects advance towards substantial completion. In the Concessions segment, gross profit decreased by $0.5 million primarily from lower management and development fees from LRT projects.
Marketing, general and administrative expense (“MG&A”) increased in the first quarter of 2025 by $4.8 million compared to the same period in 2024, primarily from higher costs related to business acquisitions of $2.7 million, as well as higher personnel costs associated with the expansion of U.S. operations. However, MG&A as a percentage of revenue decreased from 6.2% in the first quarter of 2024 to 5.4% in the first quarter of 2025 which reflects the effect of higher revenue period-over-period.
Reported backlog at March 31, 2025 of $9,696 million compared to backlog of $6,273 million at March 31, 2024. The March 31, 2025 balance represents the highest reported backlog in the history of Aecon. New contract awards of $4,096 million were booked in the first quarter of 2025 compared to $963 million in the same period in 2024.
REPORTING SEGMENTS
Aecon reports its financial performance on the basis of two segments: Construction and Concessions, which are described in the Company’s March 31, 2025 MD&A.
IBF4
