Aecon Group Inc. (TSX: ARE) (“Aecon” or the “Company”) today
reported results for the fourth quarter and year-end 2024 including
full year revenue of $4.2 billion and backlog of $6.7 billion at
December 31, 2024.
“Driven by robust year-end backlog, significant
new contract awards, 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 is
actively engaged in delivering several major long-term projects
under more collaborative models and is focused on advancing them to
the construction phase in 2025 and 2026. Aecon will maintain a
disciplined capital allocation approach and remains focused on
strategic investments in its operations to support access to new
markets.”
HIGHLIGHTS
All quarterly financial information contained in
this news release is unaudited.
- Revenue for the
year ended December 31, 2024 of $4,243 million was $401 million, or
9%, lower compared to 2023. The lower revenue was primarily driven
by decreased activity on mainline pipeline work in industrial
operations following the achievement of substantial completion on a
large project in 2023, and in urban transportation solutions from a
decrease in light rail transit (“LRT”) work as three LRT projects
near completion.
- Operating loss
of $60.1 million (operating margin(4) of -1.4%) compared to
operating profit of $240.9 million in 2023 (operating margin of
5.2%). Lower year-over-year operating profit was driven by a
decrease in other income of $186.2 million primarily due to a lower
year-over-year gain related to the sale of a 49.9% interest in the
Bermuda International Airport concessionaire (“Skyport”) of $133.1
million and a lower gain on the sale of Aecon Transportation East
(“ATE”) of $27.5 million. In addition, lower gross profit of $73.1
million contributed to the year-over-year decrease in operating
profit. This decrease was primarily due to lower gross profit
related to the four fixed price legacy projects of $57.6 million
from negative gross profit in 2024 of $272.8 million compared to
negative gross profit in 2023 of $215.2 million. These four fixed
price legacy projects are discussed in Section 5 “Recent
Developments”, Section 10.2 “Contingencies”, and Section 13 “Risk
Factors” in the Company’s December 31, 2024 Management’s
Discussions and Analysis (“MD&A”).
- Adjusted
EBITDA(1)(2) of $82.6 million for the year ended December 31, 2024
(Adjusted EBITDA margin(3) of 1.9%) compared to Adjusted EBITDA of
$143.4 million (Adjusted EBITDA margin of 3.1%) in 2023.
- Loss
attributable to shareholders of $59.5 million (diluted loss per
share of $0.95) for the year ended December 31, 2024 compared to
profit attributable to shareholders of $161.9 million (diluted
earnings per share of $2.10) in 2023.
- Adjusted loss
attributable to shareholders(1)(2) of $61.6 million (diluted
adjusted loss per share(1)(2) of $0.99) for the year ended December
31, 2024 compared to adjusted profit attributable to
shareholders(1)(2) of $160.9 million (diluted adjusted earnings per
share(1)(2) of $2.09) in 2023.
- Reported backlog
at December 31, 2024 of $6,662 million compared to backlog of
$6,157 million at December 31, 2023. New contract awards
of $4,747 million were booked in 2024 compared to $4,505 million in
2023.
- On December 2,
2024, Aecon’s subsidiary, Aecon Utilities Group Inc., acquired
Ainsworth Power Construction, an electrical services and power
systems business unit of Ainsworth Inc.
- On December 17,
2024, Aecon closed the previously disclosed acquisition of United
Engineers & Constructors (“United”).
- On December 23,
2024, Aecon’s common shares were added to the S&P/TSX Composite
Index – the principal benchmark for Canadian equity markets which
includes the largest and most liquid publicly traded companies in
Canada.
- Subsequent to
year-end:
- 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. Aecon holds a 50%
interest in the joint operation and its share of the approximately
$1.1 billion early works portion of the contract was added to its
Construction segment backlog in the fourth quarter of 2024. The
remaining portion of the contract is valued at approximately $1
billion, and Aecon will add its share to backlog in the first
quarter of 2025.
- An Aecon-led
consortium completed the collaborative development phase and
reached commercial close on the Scarborough Subway Extension
Stations, Rail and Systems progressive design-build transit
project. Aecon’s share of the target price contract is valued at
over $2.8 billion and will be added to its backlog in the first
quarter of 2025.
CONSOLIDATED FINANCIAL HIGHLIGHTS(1)
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Three months ended |
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Year ended |
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$ millions (except per share amounts) |
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December 31 |
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December 31 |
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2024 |
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2023 |
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2024 |
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2023 |
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Revenue |
$ |
1,267.0 |
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$ |
1,130.2 |
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$ |
4,242.7 |
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$ |
4,643.8 |
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Gross profit |
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107.2 |
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98.0 |
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182.5 |
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255.6 |
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Marketing, general and administrative expense |
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(57.1 |
) |
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(51.8 |
) |
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(213.2 |
) |
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(177.8 |
) |
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Income from projects accounted for using the equity method |
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1.6 |
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5.5 |
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21.2 |
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18.7 |
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Other income |
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4.1 |
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2.6 |
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37.3 |
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223.5 |
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Depreciation and amortization |
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(26.2 |
) |
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(14.6 |
) |
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(87.8 |
) |
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(79.1 |
) |
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Operating profit (loss) |
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29.6 |
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39.6 |
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(60.1 |
) |
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240.9 |
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Finance income |
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1.9 |
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2.2 |
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8.6 |
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7.7 |
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Finance cost |
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(8.3 |
) |
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(21.4 |
) |
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(25.1 |
) |
|
(71.0 |
) |
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Profit (loss) before income taxes |
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23.1 |
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20.3 |
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(76.5 |
) |
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177.5 |
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Income tax (expense) recovery |
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(9.0 |
) |
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(10.7 |
) |
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17.1 |
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(15.7 |
) |
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Profit (loss) |
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14.1 |
|
|
9.7 |
|
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(59.4 |
) |
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161.9 |
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Non-controlling interests |
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(0.1 |
) |
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- |
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(0.1 |
) |
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- |
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Profit (loss) attributable to shareholders |
$ |
14.0 |
|
$ |
9.7 |
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$ |
(59.5 |
) |
$ |
161.9 |
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Gross profit
margin(4) |
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8.5 |
% |
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8.7 |
% |
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4.3 |
% |
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5.5 |
% |
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MG&A as a percent of
revenue(4) |
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4.5 |
% |
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4.6 |
% |
|
5.0 |
% |
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3.8 |
% |
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Adjusted
EBITDA(2) |
$ |
76.3 |
|
$ |
70.2 |
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$ |
82.6 |
|
$ |
143.4 |
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Adjusted EBITDA
margin(3) |
|
6.0 |
% |
|
6.2 |
% |
|
1.9 |
% |
|
3.1 |
% |
|
|
|
Operating
margin(4) |
|
2.3 |
% |
|
3.5 |
% |
|
(1.4 |
)% |
|
5.2 |
% |
|
|
|
Adjusted profit (loss) attributable to
shareholders(2) |
$ |
16.3 |
|
$ |
7.8 |
|
$ |
(61.6 |
) |
$ |
160.9 |
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Earnings (loss) per share – basic |
$ |
0.22 |
|
$ |
0.16 |
|
$ |
(0.95 |
) |
$ |
2.62 |
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Earnings (loss) per share – diluted |
$ |
0.21 |
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$ |
0.15 |
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$ |
(0.95 |
) |
$ |
2.10 |
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Adjusted earnings (loss) per share –
basic(2) |
$ |
0.26 |
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$ |
0.13 |
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$ |
(0.99 |
) |
$ |
2.61 |
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Adjusted earnings (loss) per share –
diluted(2) |
$ |
0.25 |
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$ |
0.12 |
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$ |
(0.99 |
) |
$ |
2.09 |
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Backlog (at end of period) |
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$ |
6,662 |
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$ |
6,157 |
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(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 year ended December 31,
2024 of $4,243 million was $401 million, or 9%, lower
compared to 2023. Revenue was lower in the Construction segment
($352 million) driven by lower revenue in industrial
($460 million), urban transportation solutions
($198 million), and civil operations ($14 million),
partially offset by higher revenue in nuclear ($282 million)
and utilities operations ($38 million). This lower revenue was
primarily driven by decreased activity on mainline pipeline work in
industrial operations following the achievement of substantial
completion on a large project in 2023, and in urban transportation
solutions from a decrease in LRT work as three LRT projects near
completion. In the Concessions segment, revenue was
$61 million lower in 2024 compared to the prior year primarily
due to the use of the equity method of accounting in 2024 for
Aecon’s 50.1% retained interest in Skyport following the sale of a
49.9% interest in Skyport in the third quarter of 2023. These
amounts were partially offset by higher revenue in Corporate and
Other after inter-segment revenue eliminations
($12 million).
Operating loss of $60.1 million for the
year ended December 31, 2024 compares to operating profit of
$240.9 million for the year ended December 31, 2023, a
decrease of $301.0 million.
Lower year-over-year operating profit was driven
by a decrease in other income of $186.2 million. This decrease
was primarily due to a lower year-over-year gain related to the
sale of a 49.9% interest in Skyport of $133.1 million (a gain
of $5.9 million from incremental proceeds in 2024 compared to
a gain on sale of $139.0 million in 2023) and a lower gain on
the sale of ATE of $27.5 million (a gain of $9.0 million
from incremental proceeds in 2024 compared to a gain on sale of
$36.5 million in 2023). Also contributing to the decrease in
other income were lower gains on the sale of property, buildings,
and equipment of $27.7 million and a lower fair value
remeasurement gain on financial instruments of $0.2 million,
partially offset by higher foreign exchange gains of
$2.3 million.
In addition to the above noted decrease in other
income, lower gross profit of $73.1 million also contributed
to the year-over-year decrease in operating profit. In the
Construction segment, gross profit decreased by $49.8 million.
This decrease was primarily due to lower gross profit related to
the four fixed price legacy projects of $57.6 million from
negative gross profit in 2024 of $272.8 million compared to
negative gross profit in 2023 of $215.2 million. These four
fixed price legacy projects are discussed in Section 5 “Recent
Developments”, Section 10.2 “Contingencies”, and Section 13 “Risk
Factors” in the Company’s December 31, 2024 MD&A. Partially
offsetting the impact of these four fixed price legacy projects in
2024 was higher gross profit in the balance of the Construction
segment of $7.8 million, driven by higher volume and gross
profit margin in nuclear and utilities operations, as well as
higher gross profit in industrial operations, partially offset by
lower gross profit margin in civil operations and a volume driven
decrease in gross profit in urban transportation solutions. In the
Concessions segment, gross profit in 2024 decreased by
$33.9 million compared to 2023 primarily from the use of
the equity method of accounting in 2024 for Aecon’s 50.1% retained
interest in Skyport following the sale of a 49.9% interest in this
project in the third quarter of 2023, while in Corporate and Other,
gross profit increased by $10.7 million as a result of higher
inter-segment cost recoveries from projects.
Marketing, general and administrative expense
(“MG&A”) increased in 2024 by $35.4 million compared to
2023. The increase in MG&A was primarily due to higher
personnel costs reflecting more typical levels in MG&A, ongoing
investments to support growth and acquisitions, particularly in
utilities operations with the expansion of its U.S. operations and
the Xtreme Powerline Construction (“Xtreme”) acquisition in 2024,
and from higher acquisition related transaction costs in 2024
($9.9 million). This higher MG&A in 2024, was partially
offset by lower MG&A related to the ATE operations which was
sold in the second quarter of 2023 ($5.9 million). MG&A as
a percentage of revenue increased from 3.8% in 2023 to 5.0% in
2024.
Reported backlog at December 31, 2024 of
$6,662 million compares to backlog of $6,157 million at
December 31, 2023. New contract awards of $4,747 million
were booked in 2024 compared to $4,505 million in 2023. The
reported 2024 awards include $275 million of backlog acquired at
the time the acquisitions of United, Ainsworth Power Construction,
and Xtreme closed.
REPORTING SEGMENTS
Aecon reports its financial performance on the
basis of two segments: Construction and Concessions, which are
described in the Company’s December 31, 2024 MD&A.
CONSTRUCTION SEGMENT
Financial Highlights
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Three months ended |
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Year ended |
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$ millions |
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December 31 |
|
December 31 |
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|
2024 |
|
2023 |
|
2024 |
|
2023 |
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Revenue |
$ |
1,252.5 |
|
$ |
1,127.2 |
|
$ |
4,220.5 |
|
$ |
4,572.5 |
|
|
|
|
Gross profit |
$ |
96.1 |
|
$ |
97.6 |
|
$ |
173.6 |
|
$ |
223.4 |
|
|
|
|
Adjusted
EBITDA(1) |
$ |
65.0 |
|
$ |
65.0 |
|
$ |
34.2 |
|
$ |
99.4 |
|
|
|
|
Operating profit (loss) |
$ |
33.0 |
|
$ |
49.1 |
|
$ |
(55.0 |
) |
$ |
59.0 |
|
|
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|
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|
|
|
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|
Gross profit
margin(3) |
|
7.7 |
% |
|
8.7 |
% |
|
4.1 |
% |
|
4.9 |
% |
|
|
|
Adjusted EBITDA
margin(2) |
|
5.2 |
% |
|
5.8 |
% |
|
0.8 |
% |
|
2.2 |
% |
|
|
|
Operating
margin(3) |
|
2.6 |
% |
|
4.4 |
% |
|
(1.3 |
)% |
|
1.3 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Backlog (at end of period) |
|
|
|
|
$ |
6,551 |
|
$ |
6,053 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(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.
For the year ended December 31, 2024, revenue in
the Construction segment of $4,221 million was $352 million, or 8%,
lower than in 2023. The largest decrease in revenue occurred in
industrial ($460 million) driven by decreased activity on mainline
pipeline work following the achievement of substantial completion
on a large project in the third quarter of 2023, partially offset
by a higher volume of field construction work at wastewater
treatment and industrial facilities in western Canada in 2024, in
urban transportation solutions ($198 million) primarily from a
decrease in LRT work in Ontario and Québec as three LRT projects
near completion, and in civil operations ($14 million) largely from
a decrease in road building construction work in eastern Canada
after the sale of ATE in the second quarter of 2023 of $51 million,
partially offset in the balance of civil operations by an increase
in roadbuilding construction work in western Canada. These
decreases were partially offset by higher revenue in nuclear ($282
million) driven by an increased volume of refurbishment work at
nuclear generating stations located in Ontario and the U.S., and in
utilities operations ($38 million) primarily from an increased
volume of electrical transmission work in the U.S. and an increase
in battery energy storage system work, partially offset by a
decreased volume of telecommunications and gas distribution
work.
Operating loss in the Construction segment of
$55.0 million in 2024 compares to an operating profit of $59.0
million in 2023 for a year-over-year decrease of $114.0 million.
The largest driver of the decrease in operating profit was negative
gross profit from the four fixed price legacy projects of $272.8
million in 2024 compared to negative gross profit of $215.2 million
in 2023 for a net negative year-over-year impact on operating
profit of $57.6 million. The four fixed price legacy projects are
discussed in Section 5 “Recent Developments”, Section 10.2
“Contingencies”, and Section 13 “Risk Factors” in the December 31,
2024 MD&A. In the balance of the Construction segment,
operating profit was lower by $56.4 million of which $31.6 million
was largely in civil operations and urban transportation solutions,
and partially offset by higher operating profit in nuclear
operations from higher volume and gross profit margin, and in
industrial due to higher gross profit margin. Other items
contributing to the reduction in operating profit include an
increase in acquisition-related transaction costs that were
expensed in the year ($9.9 million largely in utilities), an
increase in amortization expense related to acquisition-related
intangible assets from the Xtreme, Ainsworth Power Construction,
and United transactions in 2024 of $5.3 million and a decrease in
other income of $9.6 million, driven by lower gains on the sale of
property, buildings, and equipment of $10.9 million, primarily in
utilities operations.
Construction segment backlog at December 31,
2024 was $6,551 million, which was $498 million higher than the
same time last year. Backlog increased year-over-year in nuclear
operations ($493 million), industrial operations ($83 million), and
urban transportation solutions ($139 million), and decreased in
civil ($146 million) and utilities operations ($71 million). New
contract awards in 2024 totaled $4,718 million compared to $4,428
million in 2023. The reported awards in 2024 include backlog of
$275 million acquired at the time the acquisitions of United,
Ainsworth Power Construction, and Xtreme closed. In 2024, joint
operations in which Aecon is a participant were awarded the
contracts to replace steam generators at three units at Bruce
Nuclear Generating Station in Ontario, and a contract for the
definition phase of refurbishment work at four units at the
Pickering Nuclear Generating Station in Ontario. As well, a
consortium, of which Aecon is a participant, was awarded a contract
to design and build the Surrey Langley SkyTrain Stations project in
British Columbia.
CONCESSIONS SEGMENT
Financial Highlights
|
|
|
|
Three months ended |
|
Year ended |
|
|
|
$
millions |
|
December 31 |
|
December 31 |
|
|
|
|
|
2024 |
|
2023 |
|
2024 |
|
2023 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue |
$ |
4.2 |
$ |
3.0 |
$ |
12.0 |
|
$ |
73.5 |
|
|
|
Gross
profit |
$ |
0.6 |
$ |
1.0 |
$ |
(1.5 |
) |
$ |
32.4 |
|
|
|
Income from projects
accounted for using the equity method |
$ |
0.8 |
$ |
2.6 |
$ |
20.8 |
|
$ |
15.8 |
|
|
|
Adjusted
EBITDA(1) |
$ |
17.4 |
$ |
19.7 |
$ |
86.9 |
|
$ |
89.8 |
|
|
|
Operating
profit |
$ |
1.6 |
$ |
4.6 |
$ |
24.2 |
|
$ |
174.1 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Backlog (at end of
period) |
|
|
|
|
$ |
111 |
|
$ |
104 |
|
|
|
|
|
|
|
|
|
|
|
|
|
(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. On September 20,
2023, Aecon sold a 49.9% interest in Skyport to Connor, Clark &
Lunn Infrastructure with Aecon retaining the management contract
for the airport. Prior to this transaction, Aecon’s participation
in Skyport was 100% consolidated and, as such, was accounted for in
the consolidated financial statements by reflecting, line by line,
the assets, liabilities, revenue and expenses of Skyport. 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 year ended December 31, 2024, revenue in
the Concessions segment of $12 million was $61 million lower than
in 2023. The decrease was primarily due to lower reported revenue
from Skyport as a result of the commencement of the equity method
of accounting for the Company’s retained 50.1% interest in Skyport
following the above noted sale of a 49.9% interest in Skyport in
the third quarter of 2023.
Operating profit in the Concessions segment of
$24.2 million for the year ended December 31, 2024 decreased by
$149.9 million compared to an operating profit of $174.1 million in
2023. The lower operating profit was primarily due to gains related
to a sale in the third quarter of 2023 of a 49.9% interest in the
Bermuda International Airport concessionaire which resulted in a
year-over-year decrease in gains on sale of $133.1 million. In the
balance of the Concessions segment, operating profit in 2024
decreased by $16.9 million. Year-over-year reported operating
profit from the ongoing operations at Skyport was negatively
impacted by a 49.9% reduction in Aecon’s ownership interest in
Skyport and from the use of the equity method of accounting in 2024
where operating results for Aecon’s interest in Skyport are
reported net of financing costs and income taxes. These
unfavourable impacts were partially offset by one-time recoveries
in Skyport in 2024 of $5.9 million.
Except for Operations and Maintenance
(“O&M”) activities under contract for the next five years and
that can be readily quantified, Aecon does not include in its
reported backlog expected revenue from concession agreements. As
such, while Aecon expects future revenue from its concession
assets, no concession backlog, other than from such O&M
activities for the next five years, is reported.
DIVIDEND
Aecon's Board of Directors approved the
quarterly dividend of 19 cents per share. The dividend will be paid
on April 2, 2025, to shareholders of record on March 21, 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 due to an opening backlog of $6.7 billion combined with recent
new awards in the first quarter, the impact of business
acquisitions completed in the second half of 2024, solid recurring
revenue, and a strong bid pipeline. Revenue growth is expected in
most of the Construction sectors, as progressive design-build or
alliance model projects move into the construction phase in 2025
and 2026.
In the Construction segment, demand for Aecon’s
services across Canada, as well as increasingly 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 will now commence under a target price contract.
Aecon’s share of the contract is valued at $2.8 billion and will be
added to its Construction segment backlog in the first quarter of
2025 and will no longer be in recurring revenue. As well, other
projects currently being delivered using progressive design-build
or alliance models and projects are also expected to move into
construction in 2025 and 2026. In addition, Aecon and its
consortium partner were recently 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. Aecon
holds a 50% interest in this joint operation and its share of the
approximately $1.1 billion early works portion of the contract was
added to its Construction segment backlog in the fourth quarter of
2024. The remaining portion of the contract is valued at
approximately $1 billion, and Aecon will add its share to backlog
in the first quarter of 2025.
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, including
projects with private sector clients that support a collective
focus on sustainability and the transition to a net-zero economy,
as well as private sector development expertise and investment to
support aging infrastructure, mobility, connectivity, and
population growth. An Aecon-led consortium that 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 is expected to reach financial
close in 2025.
Results in recent years were negatively impacted
by the four legacy projects, however, the recent Coastal GasLink
Pipeline settlement along with the additional write-downs on the
fixed price legacy projects in 2024 are anticipated to lead to
improved profitability and margin predictability, especially as the
remaining three projects move closer to substantial completion.
Until the remaining three projects are complete and the related
claims have been resolved, there is a risk that this could also
occur in future periods – see Section 5 “Recent Developments”,
Section 10.2 “Contingencies”, and Section 13 “Risk Factors” in the
December 31, 2024 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 remaining
three 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.
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 modestly higher
than in 2024. The Company has no debt or working capital credit
facility maturities until 2027, except equipment loans and leases
in the normal course.
CONSOLIDATED RESULTS
The consolidated results for the three months
and years ended December 31, 2024 and 2023 are available at the end
of this news release.
CONSOLIDATED BALANCE SHEET
|
|
|
December 31 |
|
December 31 |
|
$ thousands |
|
2024 |
|
2023 |
|
|
|
|
|
|
|
Cash and cash equivalents and restricted cash |
$ |
438,025 |
$ |
645,784 |
|
Other current assets |
|
1,790,589 |
|
1,827,472 |
|
Property, plant and equipment |
|
360,022 |
|
251,899 |
|
Other long-term assets |
|
637,588 |
|
470,473 |
|
Total Assets |
$ |
3,226,224 |
$ |
3,195,628 |
|
|
|
|
|
|
|
Current portion of long-term debt - recourse |
$ |
40,765 |
$ |
42,608 |
|
Preferred Shares of Aecon Utilities |
|
160,300 |
|
157,110 |
|
Other current liabilities |
|
1,742,363 |
|
1,583,549 |
|
Long-term debt - recourse |
110,804 |
106,770 |
|
Other long-term liabilities |
|
209,556 |
|
241,265 |
|
|
|
|
|
|
|
Equity |
|
962,436 |
|
1,064,326 |
|
Total Liabilities and Equity |
$ |
3,226,224 |
$ |
3,195,628 |
CONFERENCE CALL
A conference call and live webcast has been
scheduled for 9 a.m. (Eastern Time) on Thursday, March 6, 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 fourth
quarter and year-end 2024 financial results will also be available
after market close on March 5, 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.
AECON 2025 ANNUAL MEETING OF
SHAREHOLDERS
Aecon’s Annual Meeting of Shareholders will be
held on Tuesday, June 3, 2025. Additional details will be set out
in the Notice of Annual Meeting of Shareholders and Management
Information Circular which will be filed on SEDAR+ prior to the
meeting.
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 BorgattiSVP, Corporate Development and Investor
Relations416-297-2600ir@aecon.com
Nicole CourtVice President, Corporate
Affairs416-297-2600corpaffairs@aecon.com
NON-GAAP AND SUPPLEMENTARY FINANCIAL
MEASURES
The 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 IFRS Accounting Standards). These measures do not have
any standardized meaning and therefore are unlikely to be
comparable to similar measures presented by other issuers and
should not be considered in isolation or as a substitute for
measures of performance prepared in accordance with GAAP.
Throughout this press release, the following
terms are used, which do not have a standardized meaning under
GAAP.
Non-GAAP Financial Measures
A non-GAAP financial measure: (a) depicts the
historical or expected future financial performance, financial
position or cash flow of the Company; (b) with respect to its
composition, excludes an amount that is included in, or includes an
amount that is excluded from, the composition of the most
comparable financial measure presented in the primary consolidated
financial statements; (c) is not presented in the financial
statements of the Company; and (d) is not a ratio.
Non-GAAP financial measures and ratios presented and discussed
in this press release are as follows:
- “Adjusted EBITDA”
represents operating profit (loss) adjusted to exclude depreciation
and amortization, the gain (loss) on sale of assets and
investments, costs related to business acquisitions including:
costs related to advisory, legal and other transaction fees;
changes in the fair value of contingent consideration; and
contingent consideration classified as compensation per IFRS; costs
associated with the remediation of properties sold; and net income
(loss) from projects accounted for using the equity method, but
including “Equity Project EBITDA” from projects accounted for using
the equity method (refer to the “Reconciliations and Calculations”
section of this press release for a quantitative reconciliation to
the most comparable financial measure). The most directly
comparable measure calculated in accordance with IFRS is operating
profit.
- “Equity Project
EBITDA” represents Aecon’s proportionate share of the
earnings or losses from projects accounted for using the equity
method before depreciation and amortization, finance income,
finance cost and income tax expense (recovery) (refer to the
“Reconciliations and Calculations” section of this press release
for a quantitative reconciliation to the most comparable financial
measure).
- “Adjusted Profit (Loss)
Attributable To Shareholders” represents profit (loss)
attributable to shareholders adjusted where applicable to exclude
unrealized gains or losses on derivative financial instruments,
costs related to business acquisitions including: amortization of
acquisition-related intangible assets; costs related to advisory,
legal and other transaction fees; changes in the fair value of
contingent consideration; and contingent consideration classified
as compensation per IFRS; costs associated with the remediation of
properties sold; and where applicable the income tax effect of
these adjustments (refer to the “Reconciliations and Calculations”
section of this press release for a quantitative reconciliation to
the most comparable financial measure). The most comparable IFRS
measures for Adjusted Profit (Loss) Attributable to Shareholders is
Profit (Loss) Attributable To Shareholders.
- “Adjusted Earnings Per
Share – Basic” and “Adjusted Earnings Per Share – Diluted”
are calculated by dividing Adjusted Profit (Loss) Attributable To
Shareholders (defined above) by the basic and diluted weighted
average number of shares outstanding, respectively. The most
comparable IFRS measure for Adjusted Earnings Per Share is earnings
per share (refer to the “Reconciliations and Calculations” section
of this press release for a quantitative reconciliation to the most
comparable financial measure).
Management uses the above non-GAAP financial
measures to analyze and evaluate operating performance. Aecon also
believes the above financial measures are commonly used by the
investment community for valuation purposes, and are useful
complementary measures of profitability, and provide metrics useful
in the construction industry. These non-GAAP financial measures
exclude items which management believes will allow investors a
consistent way to analyze Aecon’s financial performance, allow for
better analysis of core operating income and business trends, and
improve comparability of companies within the industry.
Primary Financial
Statements
Primary financial statement means any of the
following: the consolidated balance sheets, the consolidated
statements of income, the consolidated statements of comprehensive
income, the consolidated statements of changes in equity, and the
consolidated statements of cash flows.
Key financial measures presented in the primary
financial statements of the Company and discussed in this press
release are as follows:
- “Gross profit”
represents revenue less direct costs and expenses. Not included in
the calculation of gross profit are marketing, general and
administrative expense (“MG&A”), depreciation and amortization,
income (loss) from projects accounted for using the equity method,
other income (loss), finance income, finance cost, income tax
expense (recovery), and non-controlling interests.
- “Operating profit
(loss)” represents the profit (loss) from operations,
before finance income, finance cost, income tax expense (recovery),
and non-controlling interests.
The above measures are presented in the
Company’s consolidated statements of income and are not meant to be
a substitute for other subtotals or totals presented in accordance
with GAAP, but rather should be evaluated in conjunction with such
GAAP measures.
- “Backlog” (Remaining
Performance Obligations) means the total value of work
that has not yet been completed that: (a) has a high certainty of
being performed as a result of the existence of an executed
contract or work order specifying job scope, value and timing; or
(b) has been awarded to Aecon, as evidenced by an executed binding
letter of intent or agreement, describing the general job scope,
value and timing of such work, and where the finalization of a
formal contract in respect of such work is reasonably assured.
Operations and maintenance (“O&M”) activities are provided
under contracts that can cover a period of up to 30 years. In order
to provide information that is comparable to the backlog of other
categories of activity, Aecon limits backlog for O&M activities
to the earlier of the contract term and the next five years.
Remaining Performance Obligations, i.e. Backlog,
is presented in the notes to the Company’s annual consolidated
financial statements and is not meant to be a substitute for other
amounts presented in accordance with GAAP, but rather should be
evaluated in conjunction with such GAAP measures.
Non-GAAP Ratios
A non-GAAP ratio is a financial measure
presented in the form of a ratio, fraction, percentage or similar
representation, and that has a non-GAAP financial measure as one of
its components and is not disclosed in the financial statements of
the Company.
A non-GAAP ratio presented and discussed in this
press release is as follows:
- “Adjusted EBITDA
margin” represents Adjusted EBITDA as a percentage of
revenue.
Management uses the above non-GAAP ratio to
analyze and evaluate operating performance. The most directly
comparable measures calculated in accordance with GAAP are gross
profit and operating profit that can be used to calculate gross
profit margin and operating margin.
Supplementary Financial
Measures
A supplementary financial measure: (a) is, or is
intended to be, disclosed on a periodic basis to depict the
historical or expected future financial performance, financial
position or cash flow of the Company; (b) is not presented in the
financial statements of the Company; (c) is not a non-GAAP
financial measure; and (d) is not a non-GAAP ratio.
Key supplementary financial measures presented
in this press release are as follows:
- “Gross profit
margin” represents gross profit as a percentage of
revenue.
- “Operating margin”
represents operating profit (loss) as a percentage of revenue.
- “MG&A as a percent of
revenue” represents marketing, general and administrative
expense as a percentage of revenue.
RECONCILIATIONS AND
CALCULATIONS
Set out below is the calculation of Adjusted
EBITDA by segment for the three months and years ended December 31,
2024 and 2023:
|
$ millions |
|
|
|
Three months ended December 31, 2024 |
Year ended December 31, 2024 |
|
|
|
|
Construction |
Concessions |
Other costs and eliminations |
Consolidated |
Construction |
Concessions |
Other costs and eliminations |
Consolidated |
|
|
|
Operating profit (loss) |
$ |
33.0 |
|
$ |
1.6 |
|
$ |
(5.1 |
) |
$ |
29.6 |
|
$ |
(55.0 |
) |
$ |
24.2 |
|
$ |
(29.2 |
) |
$ |
(60.1 |
) |
|
|
|
Depreciation and amortization |
|
26.1 |
|
|
0.1 |
|
|
0.1 |
|
|
26.2 |
|
|
86.9 |
|
|
0.3 |
|
|
0.7 |
|
|
87.8 |
|
|
|
|
(Gain) on sale of assets |
|
(0.6 |
) |
|
- |
|
|
(1.1 |
) |
|
(1.7 |
) |
|
(17.9 |
) |
|
(5.9 |
) |
|
(10.1 |
) |
|
(33.9 |
) |
|
|
|
Costs related to business acquisitions(2) |
|
4.3 |
|
|
- |
|
|
- |
|
|
4.3 |
|
|
9.7 |
|
|
0.1 |
|
|
0.1 |
|
|
9.9 |
|
|
|
|
(Income) from projects accounted for using the equity method |
|
(0.8 |
) |
|
(0.8 |
) |
|
- |
|
|
(1.6 |
) |
|
(0.4 |
) |
|
(20.8 |
) |
|
- |
|
|
(21.2 |
) |
|
|
|
Equity Project EBITDA(1) |
|
3.1 |
|
|
16.5 |
|
|
- |
|
|
19.6 |
|
|
11.1 |
|
|
88.9 |
|
|
- |
|
|
100.0 |
|
|
|
|
Adjusted
EBITDA(1) |
$ |
65.1 |
|
$ |
17.4 |
|
$ |
(6.1 |
) |
$ |
76.3 |
|
$ |
34.2 |
|
$ |
86.9 |
|
$ |
(38.5 |
) |
$ |
82.6 |
|
|
|
$ millions |
|
|
|
Three months ended December 31, 2023 |
Year ended December 31, 2023 |
|
|
|
|
Construction |
Concessions |
Other costs and eliminations |
Consolidated |
Construction |
Concessions |
Other costs and eliminations |
Consolidated |
|
|
|
Operating profit (loss) |
$ |
49.1 |
|
$ |
4.6 |
|
$ |
(14.1 |
) |
$ |
39.6 |
|
$ |
59.0 |
|
$ |
174.1 |
|
$ |
7.8 |
|
$ |
240.9 |
|
|
|
|
Depreciation and amortization |
|
14.9 |
|
|
0.1 |
|
|
(0.4 |
) |
|
14.6 |
|
|
61.1 |
|
|
17.0 |
|
|
1.0 |
|
|
79.1 |
|
|
|
|
(Gain) on sale of assets |
|
(1.8 |
) |
|
- |
|
|
(0.1 |
) |
|
(1.9 |
) |
|
(28.8 |
) |
|
(139.0 |
) |
|
(54.5 |
) |
|
(222.3 |
) |
|
|
|
Costs related to business acquisitions(2) |
|
- |
|
|
- |
|
|
- |
|
|
- |
|
|
- |
|
|
- |
|
|
- |
|
|
- |
|
|
|
|
(Income) from projects accounted for using the equity method |
|
(2.9 |
) |
|
(2.6 |
) |
|
- |
|
|
(5.5 |
) |
|
(2.9 |
) |
|
(15.8 |
) |
|
- |
|
|
(18.7 |
) |
|
|
|
Equity Project EBITDA(1) |
|
5.7 |
|
|
17.7 |
|
|
- |
|
|
23.4 |
|
|
10.9 |
|
|
53.6 |
|
|
- |
|
|
64.5 |
|
|
|
|
Adjusted
EBITDA(1) |
$ |
65.0 |
|
$ |
19.7 |
|
$ |
(14.5 |
) |
$ |
70.2 |
|
$ |
99.4 |
|
$ |
89.8 |
|
$ |
(45.8 |
) |
$ |
143.4 |
|
|
(1) This is a non-GAAP financial measure. Refer
to the “Non-GAAP and Supplementary Financial Measures” section in
this press release for more information on each non-GAAP financial
measure.(2) Costs related to business acquisitions includes costs
related to advisory, legal and other transaction fees; changes in
the fair value of contingent consideration; and contingent
consideration classified as compensation per IFRS.
Set out below is the calculation of Equity
Project EBITDA by segment for the three months and years ended
December 31, 2024 and 2023:
|
$ millions |
|
|
|
|
Three months ended December 31, 2024 |
|
Year ended December 31, 2024 |
|
|
|
Aecon's proportionate share of projects accounted for using
the equity method (1) |
Construction |
Concessions |
Other costs and eliminations |
Consolidated |
Construction |
Concessions |
Other costs and eliminations |
Consolidated |
|
|
|
Operating profit |
$ |
3.1 |
$ |
12.5 |
$ |
- |
$ |
15.6 |
$ |
11.1 |
$ |
73.5 |
$ |
- |
$ |
84.6 |
|
|
|
Depreciation and amortization |
|
- |
|
4.0 |
|
- |
|
4.0 |
|
- |
|
15.4 |
|
- |
|
15.4 |
|
|
|
Equity Project
EBITDA(2) |
$ |
3.1 |
$ |
16.5 |
$ |
- |
$ |
19.6 |
$ |
11.1 |
$ |
88.9 |
$ |
- |
$ |
100.0 |
|
|
$ millions |
|
|
|
|
Three months ended December 31, 2023 |
|
Year ended December 31, 2023 |
|
|
|
Aecon's proportionate share of projects accounted for using
the equity method (1) |
Construction |
Concessions |
Other costs and eliminations |
Consolidated |
Construction |
Concessions |
Other costs and eliminations |
Consolidated |
|
|
|
Operating profit |
$ |
5.7 |
$ |
13.9 |
$ |
- |
$ |
19.6 |
$ |
10.7 |
$ |
49.8 |
$ |
- |
$ |
60.5 |
|
|
|
Depreciation and amortization |
|
- |
|
3.8 |
|
- |
|
3.8 |
|
0.2 |
|
3.8 |
|
- |
|
4.0 |
|
|
|
Equity Project
EBITDA(2) |
$ |
5.7 |
$ |
17.7 |
$ |
- |
$ |
23.4 |
$ |
10.9 |
$ |
53.6 |
$ |
- |
$ |
64.5 |
|
(1) Refer to Note 12 “Projects Accounted for
Using the Equity Method” in the Company’s audited consolidated
financial statements for the year ended December 31, 2024.(2)
This is a non-GAAP financial measure. Refer to the “Non-GAAP and
Supplementary Financial Measures” section in this press release for
more information on each non-GAAP financial measure.
Set out below is the calculation of Adjusted
Profit (Loss) Attributable to Shareholders and Adjusted Earnings
(Loss) per Share for the three months and years ended December 31,
2024 and 2023:
|
$ millions |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended |
|
Year ended |
|
|
|
|
|
|
December 31 |
|
December 31 |
|
|
|
|
|
|
2024 |
|
2023 |
|
2024 |
|
2023 |
|
|
|
|
Profit (loss) attributable to shareholders |
$ |
14.0 |
|
$ |
9.7 |
|
$ |
(59.5 |
) |
$ |
161.9 |
|
|
|
|
|
Unrealized (gain) on derivative financial instruments |
|
(4.3 |
) |
|
(2.9 |
) |
|
(19.6 |
) |
|
(2.9 |
) |
|
|
|
|
Amortization of acquisition related intangible assets |
|
3.1 |
|
|
0.4 |
|
|
6.8 |
|
|
1.5 |
|
|
|
|
|
Costs related to business acquisitions(2) |
|
4.3 |
|
|
- |
|
|
9.9 |
|
|
- |
|
|
|
|
|
Income tax effect of the above items |
|
(0.8 |
) |
|
0.7 |
|
|
0.8 |
|
|
0.4 |
|
|
|
|
|
Adjusted profit (loss) attributable to
shareholders (1) |
$ |
16.3 |
|
$ |
7.8 |
|
$ |
(61.6 |
) |
$ |
160.9 |
|
|
|
|
|
Adjusted earnings (loss) per share -
basic(1) |
$ |
0.26 |
|
$ |
0.13 |
|
$ |
(0.99 |
) |
$ |
2.61 |
|
|
|
|
|
Adjusted earnings (loss) per share -
diluted(1) |
|
0.25 |
|
|
0.12 |
|
|
(0.99 |
) |
|
2.09 |
|
|
|
(1) This is a non-GAAP financial measure. Refer
to the “Non-GAAP and Supplementary Financial Measures” section in
this press release for more information on each non-GAAP financial
measure.(2) Costs related to business acquisitions includes costs
related to advisory, legal and other transaction fees; changes in
the fair value of contingent consideration; and contingent
consideration classified as compensation per IFRS.
STATEMENT ON FORWARD-LOOKING INFORMATION
The information in this press release includes
certain forward-looking statements which may constitute
forward-looking information under applicable securities laws. These
forward-looking statements are based on currently available
competitive, financial, and economic data and operating plans but
are subject to known and unknown risks, assumptions and
uncertainties. Forward-looking statements may include, without
limitation, statements regarding the operations, business,
financial condition, expected financial results, performance,
prospects, ongoing objectives, strategies and outlook for Aecon,
including statements regarding: expectations regarding the
financial risks and impact of the fixed price legacy projects and
the expected timelines of such projects; backlog and estimated
duration; the impact of certain contingencies on Aecon (see:
Section 10.2 “Contingencies” in the Company’s December 31, 2024
MD&A); the uncertainties related to the unpredictability of
global economic conditions; its belief regarding the sufficiency of
its current liquidity position including sufficiency of its cash
position, unused credit capacity, and cash generated from its
operations; its strategy of seeking to differentiate its service
offering and execution capability and the expected results
therefrom; its efforts to maintain a conservative capital position;
expectations regarding revenue and future revenue growth and the
impact therefrom; expectations regarding profitability and margin
predictability; expectations regarding capital expenditures;
expectations regarding the pipeline of opportunities available to
Aecon; statements regarding the various phases of projects for
Aecon and expectations regarding project timelines; its strategic
focus on projects linked to decarbonization, energy transition and
sustainability, and the opportunities arising therefrom;
communities sharing in the benefits and opportunities associated
with Aecon’s work, including commitments to publish information
with respect to reconciliation and targets including Indigenous
suppliers; expectations regarding access to new markets through
strategic investments; expectations regarding opportunities to add
to the existing portfolio of Canadian and international concessions
in the next 12 to 24 months; expectations regarding growth, and the
acceleration thereof, of Aecon in Canada and the U.S.; ; and the
effective transition and collaboration with United and United
management. Forward-looking statements may in some cases be
identified by words such as “will,” “plans,” “schedule,”
“forecast,” “outlook,” “completing,” “mitigating,” “potential,”
“possible,” “maintain,” “seek,” “cost savings,” “synergies,”
“strategy,” “goal,” “indicative,” “may,” “could,” “might,” “can,”
"believes," "expects," "anticipates," “aims,” “assumes,” “upon,”
“commences,” "estimates," "projects," "intends," “prospects,”
“targets,” “occur,” “continue,” "should" or the negative of these
terms, or similar expressions. In addition to events beyond Aecon's
control, there are factors which could cause actual or future
results, performance, or achievements to differ materially from
those expressed or inferred herein including, but not limited to:
the risk of not being able to drive a higher margin mix of business
by participating in more complex projects, achieving operational
efficiencies and synergies, and improving margins; the risk of not
being able to meet contractual schedules and other performance
requirements on large, fixed priced contracts; the risks associated
with a third party’s failure to perform; the risk of not being able
to meet its labour needs at reasonable costs; possibility of gaps
in insurance coverage; the risk of not being able to address any
supply chain issues which may arise and pass on costs of supply
increases to customers; the risks associated with international
operations and foreign jurisdiction factors; the risk of not being
able, through its joint ventures or joint operations, to enter into
implementation phases of certain projects following the successful
completion of the relevant development phase; the risk of not being
able to execute its strategy of building strong partnerships and
alliances; the risk of not being able to execute its risk
management strategy; the risk of not being able to grow backlog
across the organization by winning major projects; the risk of not
being able to maintain a number of open, recurring, and repeat
contracts; the risk of not being able to identify and capitalize on
strategic operational investments; the risk of not being able to
accurately assess the risks and opportunities related to its
industry’s transition to a lower-carbon economy; the risk of not
being able to oversee, and where appropriate, respond to known and
unknown environmental and climate change-related risks, including
the ability to recognize and adequately respond to climate change
concerns or public, governmental, and other stakeholders’
expectations on climate matters; the risk of not being able to meet
its commitment to meeting its greenhouse gas emissions reduction,
Board diversity or Indigenous supplier targets; the risks of
nuclear liability; the risks of cyber interruption or failure of
information systems; the risks associated with the strategy of
differentiating its service offerings in key end markets; the risks
associated with undertaking initiatives to train employees; the
risks associated with the seasonal nature of its business; the
risks associated with being able to participate in large projects;
the risks associated with legal proceedings to which it is a party;
the ability to successfully respond to shareholder activism; the
risk that Aecon will not realize the opportunities presented by a
transition to a net-zero economy; the risk the increase in energy
demand does not continue; risks associated with future pandemics,
epidemics and other health crises and Aecon’s ability to respond to
and implement measures to mitigate the impact of such pandemics or
epidemics; the risk that the strategic partnership with Oaktree
will not realize the expected results and may negatively impact the
existing business of Aecon Utilities; the risk that Aecon Utilities
will not realize opportunities to expand its geographic reach and
range of services in the U.S; the risk of costs or difficulties
related to the integration of Aecon and United, and of Aecon
Utilities and Xtreme, being greater than expected; the risk of the
anticipated benefits and synergies from the United and Xtreme
transactions not being fully realized or taking longer than
expected to realize; the risk of being unable to retain key
personnel, including management of United and Xtreme; the risk of
being unable to maintain relationships with customers, suppliers or
other business partners of United and Xtreme; and various other
risk factors described in Aecon’s filings with the securities
regulatory authorities, which are available under Aecon’s profile
on SEDAR+ (www.sedarplus.ca), including the risk factors described
in Section 13 - “Risk Factors” in Aecon's 2024 Management’s
Discussion and Analysis for the fiscal year ended December 31, 2024
and in other filings made by Aecon with the securities regulatory
authorities in Canada.
These forward-looking statements are based on a
variety of factors and assumptions including, but not limited to
that: none of the risks identified above materialize, there are no
unforeseen changes to economic and market conditions and no
significant events occur outside the ordinary course of business
and assumptions regarding the outcome of the outstanding claims in
respect of the fixed price legacy projects being performed by joint
ventures in which Aecon is a participant. These assumptions are
based on information currently available to Aecon, including
information obtained from third-party sources. While the Company
believes that such third-party sources are reliable sources of
information, the Company has not independently verified the
information. The Company has not ascertained the validity or
accuracy of the underlying economic assumptions contained in such
information from third-party sources and hereby disclaims any
responsibility or liability whatsoever in respect of any
information obtained from third-party sources.
Except as required by applicable securities
laws, forward-looking statements speak only as of the date on which
they are made and Aecon undertakes no obligation to publicly update
or revise any forward-looking statement, whether as a result of new
information, future events or otherwise.
|
CONSOLIDATED STATEMENTS OF INCOME FOR THE
THREE MONTHS AND YEARS ENDED DECEMBER 31, 2024 AND
2023 |
|
(in thousands of Canadian dollars, except per share
amounts) |
|
|
|
|
|
|
For the three months ended |
For the year ended |
|
|
|
|
December 31 |
|
December 31 |
December 31 |
|
December 31 |
|
|
|
|
2024 |
|
2023 |
2024 |
|
2023 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue |
|
$ |
1,267,013 |
|
|
$ |
1,130,185 |
|
$ |
4,242,731 |
|
|
$ |
4,643,842 |
|
|
Direct costs and expenses |
|
|
(1,159,770 |
) |
|
|
(1,032,235 |
) |
|
(4,060,184 |
) |
|
|
(4,388,216 |
) |
|
Gross profit |
|
|
107,243 |
|
|
|
97,950 |
|
|
182,547 |
|
|
|
255,626 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Marketing, general and administrative expense |
|
|
(57,132 |
) |
|
|
(51,811 |
) |
|
(213,248 |
) |
|
|
(177,839 |
) |
|
Depreciation and amortization |
|
|
(26,237 |
) |
|
|
(14,648 |
) |
|
(87,849 |
) |
|
|
(79,087 |
) |
|
Income from projects accounted for using the equity method |
|
|
1,566 |
|
|
|
5,496 |
|
|
21,210 |
|
|
|
18,747 |
|
|
Other income |
|
|
4,111 |
|
|
|
2,584 |
|
|
37,288 |
|
|
|
223,467 |
|
|
Operating profit (loss) |
|
|
29,551 |
|
|
|
39,571 |
|
|
(60,052 |
) |
|
|
240,914 |
|
|
|
|
|
|
|
|
- |
|
|
|
|
|
|
|
Finance income |
|
|
1,920 |
|
|
|
2,202 |
|
|
8,637 |
|
|
|
7,665 |
|
|
Finance cost |
|
|
(8,326 |
) |
|
|
(21,427 |
) |
|
(25,114 |
) |
|
|
(71,034 |
) |
|
Profit (loss) before income taxes |
|
|
23,145 |
|
|
|
20,346 |
|
|
(76,529 |
) |
|
|
177,545 |
|
|
Income tax recovery (expense) |
|
|
(9,042 |
) |
|
|
(10,651 |
) |
|
17,089 |
|
|
|
(15,655 |
) |
|
Profit (loss) for the period |
|
$ |
14,103 |
|
|
$ |
9,695 |
|
$ |
(59,440 |
) |
|
$ |
161,890 |
|
|
Profit (loss) attributable to: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Aecon shareholders |
|
|
14,025 |
|
|
|
9,695 |
|
|
(59,524 |
) |
|
|
161,890 |
|
|
|
Non-controlling interests |
|
|
78 |
|
|
|
- |
|
|
84 |
|
|
|
- |
|
|
|
|
|
$ |
14,103 |
|
|
$ |
9,695 |
|
$ |
(59,440 |
) |
|
$ |
161,890 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic earnings (loss) per share |
|
$ |
0.22 |
|
|
$ |
0.16 |
|
$ |
(0.95 |
) |
|
$ |
2.62 |
|
|
Diluted earnings (loss) per share |
|
$ |
0.21 |
|
|
$ |
0.15 |
|
$ |
(0.95 |
) |
|
$ |
2.10 |
|
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