CAE reports fourth quarter and full fiscal year 2025 results

Q4 FY2025

• Revenue of $1,275.4 million vs. $1,126.3 million in Q4 last year

• Earnings per share (EPS) from continuing operations of $0.42 vs. negative $1.58 in Q4 last year

• Adjusted EPS⁽¹⁾ of $0.47 vs. $0.12 in Q4 last year

• Operating income of $239.9 million vs. operating loss of $533.0 million in Q4 last year

• Adjusted segment operating income⁽¹⁾ of $258.8 million vs. $125.7 million in Q4 last year

• Free cash flow⁽¹⁾ of $289.4 million vs. $191.1 million in Q4 last year

• Adjusted order intake⁽¹⁾ of $1.3 billion for 1.05x book-to-sales ratio⁽¹⁾

• Net debt-to-adjusted EBITDA⁽¹⁾ of 2.77x vs. 3.36x at the end of the preceding quarter

Annual FY2025

• Revenue of $4.7 billion vs. $4.3 billion last year

• EPS from continuing operations of $1.27 vs. negative $1.02 last year

• Adjusted EPS of $1.21 vs. $0.87 last year

• Operating income of $729.2 million vs. operating loss of $185.4 million last year

• Adjusted segment operating income of $732.0 million vs. $549.7 million last year

• Free cash flow of a record $813.9 million for 211% cash conversion⁽¹⁾

• Adjusted order intake of $7.7 billion for $20.1 billion adjusted backlog⁽¹⁾ and 1.64x book-to-sales ratio

Montreal, Canada, May 13, 2025 – (NYSE: CAE; TSX: CAE)

CAE Inc. (CAE or the Company) today reported its financial results for the fourth quarter ended March 31, 2025.

Strong performance driven by disciplined execution and efficient capital management

“We delivered an exceptional fourth quarter, capping a strong year across all key financial and operational metrics,” said Marc Parent, CAE’s President and Chief Executive Officer. “Disciplined execution and efficient capital management drove $289.4 million in free cash flow for the quarter and a record $813.9 million for the year, reflecting a robust cash conversion rate of 211 percent. This performance allowed us to meet our year-end leverage target, further strengthening our balance sheet. We also continued to build momentum for long-term growth and profitability, securing $1.3 billion in adjusted order intake for the quarter and closing with an adjusted backlog of $20.1 billion, up 65% from last year.”

Executing strategy with focus and operational rigour

On CAE’s segmented performance, Mr. Parent added, “I’m extremely proud of what the team has accomplished by executing CAE’s strategy with strong focus and operational rigour. We accelerated our path to greater profitability in Defense, delivering an adjusted segment operating income margin of 9.2 percent in the quarter and 7.5 percent for the full year, driven by solid program execution and a near-doubling of the adjusted Defense backlog to $11.3 billion. In Civil, despite the headwind of constrained aircraft availability and drop in U.S. pilot hiring, we delivered strong results, demonstrating the resilience of our business model and the strength of our global franchise. Civil achieved a record adjusted segment margin of 28.6 percent in the fourth quarter and 21.5 percent for the year, with annual adjusted segment operating income growing to $581.5 million. Civil adjusted backlog grew nearly 40 percent to a record $8.8 billion, supported by $3.7 billion in adjusted order intake, including 56 full-flight simulators.”

Poised for continued growth, margin expansion and strong free cash flow

“We expect continued growth in fiscal 2026, supported by higher margins and strong free cash flow. With CAE’s highly cash-generative business and the completion of a significant multiyear investment cycle, we are well positioned to further deleverage the balance sheet and enhance our financial flexibility,” said Mr. Parent. “In Civil, our outlook reflects a position of strength, even as we take a measured view of first-half performance amid macroeconomic dynamics. In Defense, CAE is well-positioned for long-term growth and profitability. A sustained up-cycle in defence spending across NATO and allied nations is driving increased demand for CAE’s advanced training and simulation solutions. In Canada, where we are the country’s largest public defence contractor, we were recently named a strategic partner by the Government of Canada to design and co-develop the Royal Canadian Air Force’s Future Fighter Lead-in Training program, a critical initiative to prepare pilots for next-generation fighter operations.”

Structural resilience and secular tailwinds across Civil and Defense

“CAE’s business model remains inherently resilient, supported by structural strengths across its Civil and Defense segments,” added Mr. Parent. “In Civil, resiliency is driven by a high proportion of recurring revenue within the highly regulated aviation training market, which mandates both initial and recurrent training for active and new pilots. The segment continues to benefit from long-term secular growth factors, including rising global passenger traffic, mandatory pilot retirements, and the need to train over 280,000 new pilots over the next decade. These dynamics have historically supported Civil’s relative stability through economic cycles and market disruptions. Defense further contributes to the Company’s overall resiliency by providing exposure outside the commercial cycle. The segment is well-positioned for secular growth, supported by increasing defence budgets across NATO and allied nations. Together, these factors reinforce the strength and durability of CAE’s business model and underpin our confidence in the Company’s long-term growth prospects, notwithstanding current macroeconomic dynamics.”

Consolidated results

Fourth quarter fiscal 2025 revenue was $1,275.4 million, compared to $1,126.3 million last year. Fourth quarter EPS from continuing operations was $0.42 compared to negative $1.58 last year. Adjusted EPS was $0.47 compared to $0.12 last year. Operating income this quarter was $239.9 million (18.8% of revenue⁽¹⁾), compared to an operating loss of $533.0 million last year, which included an impairment of goodwill of $568.0 million and an impairment of technology and other non-financial assets of $35.7 million. Fourth quarter adjusted segment operating income was $258.8 million (20.3% of revenue⁽¹⁾) compared to $125.7 million (11.2% of revenue) last year.

Annual fiscal 2025 revenue was $4.7 billion, compared to $4.3 billion last year. Annual EPS from continuing operations was $1.27 compared to negative $1.02 in fiscal 2024. Annual adjusted EPS was $1.21 this year compared to $0.87 last year. Annual operating income was $729.2 million (15.5% of revenue), compared to an operating loss of $185.4 million last year. Adjusted segment operating income was $732.0 million (15.5% of revenue) compared to $549.7 million (12.8% of revenue) last year. All financial information is in Canadian dollars and results are presented on a continuing operations basis, unless otherwise indicated.

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