Aecon reports second quarter 2025 results with record backlog of $10.7 billion
Press Release
Toronto, Ontario – July 31, 2025 : Aecon Group Inc. (TSX: ARE) (“Aecon” or the “Company”) today reported results for the second quarter of 2025.
“Driven by record backlog of $10.7 billion, solid recurring revenue programs, a robust bid pipeline, and the impact of strategic acquisitions in 2024, revenue in 2025 is expected to be stronger than last year,” said Jean-Louis Servranckx, President and Chief Executive Officer, Aecon Group Inc. “Aecon is pleased to be delivering North America’s three largest nuclear refurbishments, executing and pursuing a growing set of nuclear opportunities in the U.S. and globally, and leading the construction of North America’s first commercial, grid-scale Small Modular Reactor (SMR) for Ontario Power Generation following commencement of the execution phase on the Darlington New Nuclear Project in the second quarter.”
HIGHLIGHTS
All quarterly financial information contained in this news release is unaudited.
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Revenue for the three months ended June 30, 2025 of $1,302 million was $448 million, or 52%, higher compared to the same period in 2024.
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Operating profit of $2.3 million for the three months ended June 30, 2025 compared to an operating loss of $166.3 million for the same period in 2024.
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Adjusted EBITDA(1)(2) of $41.1 million for the three months ended June 30, 2025 (Adjusted EBITDA margin(3) of 3.2%) compared to Adjusted EBITDA of $(153.5) million (Adjusted EBITDA margin of (18.0%)) in the same period in 2024. The increase in the quarter was largely due to a decrease in losses on the fixed price legacy projects of $198.2 million (i.e. negative gross profit of $38.8 million in the second quarter of 2025 compared to negative gross profit of $237.0 million in the second quarter of 2024). The fixed price legacy projects are discussed in Section 5 “Recent Developments” and Section 10.2 “Contingencies” in the Company’s June 30, 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 $7.6 million (diluted loss per share of $0.12) for the three months ended June 30, 2025 compared to loss attributable to shareholders of $123.9 million (diluted loss per share of $1.99) in the same period in 2024.
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Reported backlog at June 30, 2025 of $10,746 million compared to backlog of $6,186 million at June 30, 2024. The June 30, 2025 balance represents the highest reported backlog in the history of Aecon. New contract awards of $2,351 million were booked in the second quarter of 2025 compared to $766 million in the same period in 2024.
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An Aecon-led general partnership was awarded an alliance construction contract by Ontario Power Generation for the execution phase on the Darlington New Nuclear Project in Ontario. Aecon’s share of the contract is valued at approximately $1.3 billion and was added to its Construction segment backlog in the second quarter of 2025.
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The Oneida Energy Storage Project in Ontario officially commenced commercial operations, becoming the largest grid-scale battery energy storage facility in operation in Canada and one of the largest globally. Aecon led the engineering, procurement and construction services for the project alongside Aecon-Six Nations, and Aecon Concessions holds an ownership interest in the facility’s operations.
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Aecon was named one of the Corporate Knights 2025 Best 50 Corporate Citizens in Canada, recognizing Aecon’s continued efforts for sustainable investment, revenue, and construction practices relative to industry peers.
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Subsequent to quarter end, an Aecon-led consortium reached financial close on a contract to execute a civil project. Aecon’s share of the contract is valued at $477 million and will be added to its Construction segment backlog in the third quarter of 2025.
CONSOLIDATED FINANCIAL HIGHLIGHTS
| Three months ended | Six months ended | |||||||||||
| $ millions (except per share amounts) | June 30 | June 30 | ||||||||||
| 2025 | 2024 | 2025 | 2024 | |||||||||
| Revenue | $ | 1,301.6 | $ | 853.8 | $ | 2,363.2 | $ | 1,700.4 | ||||
| Gross profit (loss) | 76.9 | (137.9) | 118.7 | (75.1) | ||||||||
| Marketing, general and administrative expense | (59.5) | (48.2) | (116.4) | (100.3) | ||||||||
| Income from projects accounted for using the equity method | 4.0 | 11.6 | 3.7 | 13.8 | ||||||||
| Other income | 6.6 | 28.0 | 7.3 | 29.7 | ||||||||
| Depreciation and amortization | (25.8) | (19.8) | (51.8) | (38.6) | ||||||||
| Operating profit (loss) | 2.3 | (166.3) | (38.4) | (170.5) | ||||||||
| Finance income | 1.5 | 2.1 | 3.0 | 5.3 | ||||||||
| Finance cost | (14.7) | (6.6) | (24.7) | (12.2) | ||||||||
| Loss before income taxes | (11.0) | (170.8) | (60.1) | (177.4) | ||||||||
| Income tax recovery | 3.1 | 46.9 | 14.2 | 47.4 | ||||||||
| Loss | $ | (7.9) | $ | (123.9) | $ | (45.9) | $ | (130.0) | ||||
| Non-controlling interests | $ | 0.2 | – | 0.4 | – | |||||||
| Loss attributable to shareholders | $ | (7.6) | $ | (123.9) | $ | (45.6) | $ | (130.0) | ||||
| Gross profit margin(4) | 5.9% | (16.2)% | 5.0% | (4.4)% | ||||||||
| MG&A as a percent of revenue(4) | 4.6% | 5.6% | 4.9% | 5.9% | ||||||||
| Adjusted EBITDA(2) | $ | 41.1 | $ | (153.5) | $ | 44.6 | $ | (120.7) | ||||
| Adjusted EBITDA margin(3) | 3.2% | (18.0)% | 1.9% | (7.1)% | ||||||||
| Operating margin(4) | 0.2% | (19.5)% | (1.6)% | (10.0)% | ||||||||
| Adjusted loss attributable to shareholders(2) | $ | (5.5) | $ | (126.4) | $ | (39.5) | $ | (135.4) | ||||
| Loss per share – basic | $ | (0.12) | $ | (1.99) | $ | (0.72) | $ | (2.09) | ||||
| Loss per share – diluted | $ | (0.12) | $ | (1.99) | $ | (0.72) | $ | (2.09) | ||||
| Adjusted loss per share – basic2 | $ | (0.09) | $ | (2.03) | $ | (0.63) | $ | (2.17) | ||||
| Adjusted loss per share – diluted2 | $ | (0.09) | $ | (2.03) | $ | (0.63) | $ | (2.17) | ||||
| Backlog (at end of period) | $ | 10,746 | $ | 6,186 | ||||||||
(1) 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.
(2) 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.
(3) 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.
(4) 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 June 30, 2025 of $1,302 million was $448 million, or 52%, higher compared to the second quarter of 2024. In the Construction segment, revenue was higher by $447 million from increases in industrial ($192 million), nuclear ($147 million), civil ($75 million), urban transportation solutions ($27 million), and utilities operations ($6 million). This higher revenue was driven primarily by a higher volume of field construction work at industrial facilities in western Canada and the impact on revenue of the Coastal Gaslink Pipeline Project settlement agreement in 2024, an increased volume of refurbishment and engineering services work at nuclear generating stations in Ontario and the U.S., and the revenue impact of the acquisitions of Xtreme Powerline Construction (“Xtreme”), Ainsworth Power Construction, and United Engineers & Constructors Inc. (“United”) that occurred in the second half of 2024. In the Concessions segment, revenue of $2 million for the three months ended June 30, 2025 remained unchanged compared to the same period last year.
Operating profit of $2.3 million for the three months ended June 30, 2025 increased by $168.6 million compared to an operating loss of $166.3 million in the same period of 2024. Higher operating profit was largely driven by an increase in quarterly gross profit of $214.8 million compared to the same period in 2024. In the Construction segment, gross profit increased by $213.5 million primarily from a decrease in losses on the fixed price legacy projects of $198.2 million (i.e. negative gross profit of $38.8 million in the second quarter of 2025 compared to negative gross profit of $237.0 million in the second quarter of 2024). The fixed price legacy projects are discussed in Section 5 “Recent Developments” and Section 10.2 “Contingencies” in the Company’s June 30, 2025 MD&A, and Section 13 “Risk Factors” in the 2024 Annual MD&A. Other than the impact of the fixed price legacy projects, gross profit in the balance of the Construction segment in the second quarter of 2025 was higher by $15.3 million primarily due to higher volume and gross profit margin in nuclear, higher gross profit margin in utilities operations, and higher volume in industrial operations. These gross profit increases were partially offset by lower gross profit in civil from weaker gross profit margin in western operations, and from lower gross profit margin in urban transportation solutions from light rail transit (“LRT”) and rail electrification projects as these projects advance towards completion. In the Concessions segment, gross profit increased by $0.2 million from higher management and development fees.
Marketing, general and administrative expense (“MG&A”) increased in the second quarter of 2025 by $11.3 million compared to the same period in 2024, primarily from MG&A related to the Xtreme, Ainsworth Power Construction, and United operations that were acquired in the second half of 2024, and from an increase in acquisition related transaction costs of $2.3 million. MG&A as a percentage of revenue for the second quarter decreased to 4.6% in 2025 from 5.6% in 2024, and for the first six months decreased to 4.9% in 2025 from 5.9% in 2024.
Reported backlog at June 30, 2025 of $10,746 million compares to backlog of $6,186 million at June 30, 2024. The June 30, 2025 balance represents the highest reported backlog in the history of Aecon. New contract awards of $2,351 million and $6,447 million were booked in the second quarter and year-to-date, respectively, in 2025 compared to $766 million and $1,729 million in the same periods 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 June 30, 2025 MD&A.
CONSTRUCTION SEGMENT
| Financial Highlights | |||||||||||||
| Three months ended | Six months ended | ||||||||||||
| $ millions | June 30 | June 30 | |||||||||||
| 2025 | 2024 | 2025 | 2024 | ||||||||||
| Revenue | $ | 1,298.1 | $ | 851.5 | $ | 2,355.5 | $ | 1,695.3 | |||||
| Gross profit (loss) | $ | 76.6 | $ | (136.8) | $ | 119.6 | $ | (73.3) | |||||
| Adjusted EBITDA(1) | $ | 39.7 | $ | (172.6) | $ | 38.6 | $ | (144.9) | |||||
| Operating profit (loss) | $ | 14.9 | $ | (185.0) | $ | (15.0) | $ | (177.5) | |||||
| Gross profit margin(3) | 5.9% | (16.1)% | 5.1% | (4.3)% | |||||||||
| Adjusted EBITDA margin(2) | 3.1% | (20.3)% | 1.6% | (8.5)% | |||||||||
| Operating margin(3) | 1.1% | (21.7)% | (0.6)% | (10.5)% | |||||||||
| Backlog (at end of period) | $ | 10,726 | $ | 6,167 | |||||||||
(1) 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.
(2) This is a non-GAAP ratio. 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 ratio.
(3) 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 in the Construction segment for the three months ended June 30, 2025 of $1,298 million was $447 million, or 52%, higher compared to the same period in 2024. Revenue was higher in industrial operations ($192 million) driven primarily by an increased volume of field construction work at industrial facilities in western Canada and the impact on revenue of the Coastal Gaslink Pipeline Project settlement agreement in 2024; in nuclear operations ($147 million) from an increased volume of refurbishment and engineering services work at nuclear generating stations located in Ontario and the U.S.; in civil operations ($75 million) from a higher volume of major projects, roadbuilding construction, and foundations work; in urban transportation solutions ($27 million) primarily from an increase in mass transit project work in Ontario; and in utilities operations ($6 million) from a higher volume of gas distribution work in Canada and electrical transmission work in the U.S. following the acquisition of Xtreme in the second half of 2024, partially offset by a lower volume of telecommunications work
Operating profit in the Construction segment of $14.9 million in the three months ended June 30, 2025 compares to an operating loss of $185.0 million in the same period in 2024, for an increase in operating profit of $199.9 million. The largest driver of the improvement in operating profit was a net positive impact on operating profit of $198.2 million from the fixed price legacy projects (i.e. negative gross profit from the fixed price legacy projects of $38.8 million in the second quarter of 2025 compared to negative gross profit of $237.0 million in the second quarter of 2024). The fixed price legacy projects are discussed in Section 5 “Recent Developments” and Section 10.2 “Contingencies” in the Company’s June 30, 2025 MD&A, and Section 13 “Risk Factors” in the 2024 Annual MD&A. In the balance of the Construction segment, operating profit was higher by $1.6 million, driven by higher volume and gross profit margin in nuclear, higher gross profit margin in utilities operations, and from the impact on gross profit of higher volume in industrial operations. These increases were largely offset by lower operating profit in civil from weaker gross profit in western operations, and in urban transportation solutions from lower gross profit on mass transit projects that are nearing completion. Other items contributing to a reduction in operating profit include an increase in acquisition-related transaction costs that were expensed in the quarter ($2.3 million largely in utilities), an increase in amortization expense related to acquisition-related intangible assets of $5.3 million from the Xtreme, Ainsworth Power Construction, and United transactions that occurred in 2024, and a decrease in other income of $4.7 million, driven by lower gains on the sale of property, buildings, and equipment of $5.3 million, primarily in industrial operations.
Construction segment backlog at June 30, 2025 was $10,726 million, which was $4,559 million higher than the same time last year. Backlog increased period-over-period in urban transportation solutions ($2,997 million), nuclear ($1,505 million), utilities ($119 million), and civil operations ($40 million), and decreased in industrial operations ($102 million). New contract awards totaled $2,347 million in the second quarter of 2025 and $6,440 million year-to-date, compared to $764 million and $1,728 million, respectively, in the same periods last year. During the first six months of 2025, an Aecon-led consortium reached commercial close on a progressive design-build project for the Scarborough Subway Extension, a joint operation in which Aecon is a participant was awarded a contract for the definition phase of refurbishment work on four units at the Pickering Nuclear Generating Station in Ontario, and an Aecon-led partnership was awarded an alliance construction contract for the execution phase of the Darlington New Nuclear Project in Clarington, Ontario.
CONCESSIONS SEGMENT
| Financial Highlights | |||||||||||||
| Three months ended | Six months ended | ||||||||||||
| $ millions | June 30 | June 30 | |||||||||||
| 2025 | 2024 | 2025 | 2024 | ||||||||||
| Revenue | $ | 1.8 | $ | 2.3 | $ | 3.4 | $ | 5.2 | |||||
| Gross loss | $ | (0.9) | $ | (1.1) | $ | (2.0) | $ | (1.7) | |||||
| Income from projects accounted for using the equity method | $ | 4.3 | $ | 11.9 | $ | 4.5 | $ | 14.1 | |||||
| Adjusted EBITDA(1) | $ | 16.4 | $ | 29.5 | $ | 29.2 | $ | 47.1 | |||||
| Operating profit | $ | 2.9 | $ | 16.8 | $ | 1.2 | $ | 17.9 | |||||
| Backlog (at end of period) | $ | 20 | $ | 19 | |||||||||
(1) 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.
Aecon currently holds a 50.1% interest in Skyport, the concessionaire responsible for the Bermuda airport’s operations, maintenance, and commercial functions, and the entity that will manage and coordinate the overall delivery of the Bermuda International Airport Redevelopment Project over a 30-year concession term that commenced in 2017. Aecon’s participation in Skyport is accounted for using the equity method. Aecon’s concession participation in the Eglinton Crosstown LRT, Finch West LRT, Gordie Howe International Bridge, Waterloo LRT, and the GO Expansion On-Corridor Works projects are joint ventures that are also accounted for using the equity method.
For the three months ended June 30, 2025, revenue in the Concessions segment of $2 million was unchanged compared to the same period last year.
Operating profit in the Concessions segment of $2.9 million for the three months ended June 30, 2025 was lower by $13.9 million compared to the same period in 2024. The lower operating profit was driven by a gain on sale of $5.9 million related to incremental proceeds from the partial sale of Skyport received in the second quarter of 2024, and from one-time recoveries in Skyport of $5.9 million reported in the second quarter of 2024. Operating profit in the balance of the segment was also impacted by lower management and development fees.
DIVIDEND
Aecon’s Board of Directors approved its next quarterly dividend of 19 cents per common share. The dividend will be paid on October 2, 2025 to shareholders of record as of September 22, 2025. Unless indicated otherwise, all common share dividends paid by Aecon to shareholders are designated as “eligible” dividends for the purpose of the Income Tax Act (Canada) and any similar provincial legislation.
OUTLOOK
Revenue in 2025 is expected to be stronger than 2024, driven by record reported backlog of $10.7 billion at the end of the second quarter of 2025, recurring revenue programs continuing to see solid demand, a strong bid pipeline, and the impact of strategic acquisitions completed in the second half of 2024. Revenue growth is expected in most of the Construction sectors.
In the Construction segment, demand for Aecon’s services across Canada and in select U.S. and international markets continues to be strong. Development phase work is ongoing in consortiums in which Aecon is a participant to deliver several significant long-term progressive design-build projects of various sizes. In the first quarter of 2025, an Aecon-led consortium completed the collaborative development phase and reached commercial close on the Scarborough Subway Extension progressive design-build transit project. The implementation phase of the project has commenced under a target price contract. In addition, an Aecon joint operation was awarded a collaborative contract by Ontario Power Generation 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. In the second quarter of 2025, an Aecon-led partnership was awarded an alliance construction contract by Ontario Power Generation for the execution phase of the Darlington New Nuclear Project in Ontario. Other projects currently being delivered using progressive design-build or alliance models are also expected to move into construction in 2025 and 2026.
In the Concessions segment, there are several opportunities to add to the existing portfolio of Canadian and international concessions in the next 12 to 24 months to support trends in aging infrastructure, mobility, connectivity, and population growth. An Aecon-led consortium was selected by the U.S. Virgin Islands Port Authority to redevelop the Cyril E. King Airport in St. Thomas and the Henry E. Rohlsen Airport in St. Croix under a collaborative Design, Build, Finance, Operate, and Maintain Public-Private Partnership model, pending financial close.
Operating profitability in recent years was negatively impacted by the four fixed price legacy projects. The three remaining legacy projects are expected to reach substantial completion by the end of 2025 and this is anticipated to lead to improved profitability and margin predictability. Until the three remaining projects are complete and the related claims have been resolved, there is a risk that profitability could also be negatively impacted by these projects in future periods – see Section 5 “Recent Developments” and Section 10.2 “Contingencies” in the June 30, 2025 MD&A and Section 13 “Risk Factors” in the 2024 Annual MD&A regarding the risk on certain large fixed price legacy projects entered into in 2018 or earlier by joint operations in which Aecon is a participant. As such, the completion and satisfactory resolution of claims on the three remaining legacy projects with the respective clients remains a critical focus for the Company and its partners.
Management will also be monitoring the impact of announced or threatened tariffs or non-tariff measures on the Company’s operations. The introduction of these measures could cause increased purchased material costs and/or reduced availability, as well as delays by some private clients in moving forward with projects.
Aecon plans to maintain a disciplined capital allocation approach focused on long-term shareholder value through acquisitions and divestitures, organic growth, dividends, capital investments, and common share buybacks on an opportunistic basis. Aecon is also focused on making strategic investments in its operations to support access and entry into new markets and increase operational effectiveness. Capital expenditures in 2025 are expected to be moderately higher than in 2024.
CONSOLIDATED RESULTS
The consolidated results for the three and six months ended June 30, 2025 and 2024 are available at the end of this news release.
CONSOLIDATED BALANCE SHEET
| June 30 | December 31 | |||
| $ thousands | 2025 | 2024 | ||
| Cash and cash equivalents | $ | 462,326 | $ | 438,025 |
| Other current assets | 1,979,373 | 1,790,589 | ||
| Property, plant and equipment | 369,531 | 360,022 | ||
| Other long-term assets | 635,553 | 637,588 | ||
| Total Assets | $ | 3,446,783 | $ | 3,226,224 |
| Current portion of long-term debt | $ | 43,377 | $ | 40,765 |
| Preferred Shares of Aecon Utilities | 161,930 | 160,300 | ||
| Other current liabilities | 1,808,506 | 1,742,363 | ||
| Long-term debt | 107,486 | 110,804 | ||
| Other long-term liabilities | 431,406 | 209,556 | ||
| Total Equity | 894,078 | 962,436 | ||
| Total Liabilities and Equity | $ | 3,446,783 | $ | 3,226,224 |
CONFERENCE CALL
A conference call and live webcast has been scheduled for 9 a.m. (Eastern Time) on Friday, August 1, 2025. A live webcast of the conference call can be accessed using this link and will be available at www.aecon.com/InvestorCalendar. Participants can also dial-in to the conference call and pre-register using this link. After registering, an email will be sent, including dial-in details and a unique access code required to join the live call. Please ensure you have registered at least 15 minutes prior to the conference call time.
An accompanying presentation of the second quarter 2025 financial results will also be available after market close on July 31, 2025 at www.aecon.com/investing. For those unable to attend, a replay will be available within one hour following the live webcast and conference call at the same webcast link above.
ABOUT AECON
Aecon Group Inc. (TSX: ARE) is a North American construction and infrastructure development company with global experience. Aecon delivers integrated solutions to private and public-sector clients through its Construction segment in the Civil, Urban Transportation, Nuclear, Utility, and Industrial sectors, and provides project development, financing, investment, management, and operations and maintenance services through its Concessions segment. Join our online community on X, LinkedIn, Facebook, and Instagram @AeconGroupInc.
For further information:
Adam Borgatti
SVP, Corporate Development and Investor Relations
(416) 297-2600
ir@aecon.com
Nicole Court
Vice President, Corporate Affairs and Communications
(416) 297-2600
corpaffairs@aecon.com
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