CAE (CAE) Q4 2026 earnings summary

Executive summary

• A comprehensive transformation plan is underway, targeting CAD 125–150 million ($125–$150 million) in annual run-rate savings by fiscal 2030, with execution across eight workstreams and a focus on operational efficiency, portfolio optimization, and capital discipline.

• Leadership changes and organizational simplification have aligned the business around Civil and Defence segments, reducing president positions and implementing shared service operations.

• Updated definitions for key non-IFRS metrics reinforce focus on cash returns, accountability, and shareholder value.

• FY2030 targets include adjusted segment operating income of CAD 950 million–1 billion ($950M–$1B) and 100% cumulative cash conversion over four years.

• Civil segment is rationalizing its network for resiliency and profitability, while Defence benefits from increased spending and operational momentum.

Financial highlights

• Q4 FY2026 consolidated revenue was CAD 1.3 billion ($1,326.7 million), up 4% year-over-year; adjusted segment operating income was CAD 211.8 million, down from CAD 258.8 million.

• Full-year revenue reached CAD 4.9 billion (+4%), with adjusted segment operating income at CAD 710.7 million (14.5% margin) and adjusted EPS at CAD 1.20.

• Fiscal 2026 free cash flow was CAD 473.8 million (123% conversion), with Q4 free cash flow at CAD 135.0 million.

• Civil Q4 revenue was CAD 746.7 million (+3%), adjusted segment operating income CAD 152.4 million (20.4% margin); full-year revenue CAD 2.7 billion (+1%), margin 18.6%.

• Defence Q4 revenue was CAD 580 million (+6%), adjusted segment operating income CAD 59.4 million (10.2% margin); full-year revenue CAD 2.2 billion (+9%), margin 9.2%.

Outlook and guidance

• Fiscal 2027 is a reset year, with low single-digit consolidated revenue growth expected; Civil revenue flat to slightly down, Defence up mid-single digits.

• Adjusted segment operating income margin expected at 14.6%–15.1%; adjusted EPS between CAD 1.21–1.28; free cash flow conversion 85%–95%.

• Transformation plan to yield CAD 125–150 million in annual run-rate savings by 2030, with most benefits materializing in 2028 and incremental gains through 2030.

• Long-term targets for fiscal 2030: mid-single-digit organic revenue growth, CAD 950 million–1 billion adjusted segment operating income, 100% cumulative cash conversion, and net debt/adjusted EBITDA of ~2.5x.