Aecon reports second quarter 2025 results with record backlog of $10.7 billion
TORONTO, July 31, 2025 (GLOBE NEWSWIRE) -- 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."
HIGHLIGHTSAll quarterly financial information contained in this news release is unaudited.
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.
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.
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.
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.
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.
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.
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.
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.
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, basic(2)
$
(0.09
)
$
(2.03
)
$
(0.63
)
$
(2.17
)
Adjusted loss per share, diluted(2)
$
(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
