Calian Group (CGY) Q1 2025 earnings summary

Executive summary

• Q1 FY25 revenue reached a record CAD 185 million, up 3% year-over-year, with trailing 12-month revenues surpassing CAD 750 million, and new contracts totaling CAD 154 million, ending with a CAD 1.1 billion backlog.

• Defense remains the largest and fastest-growing market, accounting for 44% of consolidated revenues in FY24, driven by global demand and strategic contract wins.

• Strategic hires, expansion in the U.K., Europe, and U.S., and the launch of a U.S. subsidiary are expected to drive further growth.

• Acquisitive growth of 8% offset a 5% organic decline, with recent acquisitions in the UK, US, and Canada contributing.

• Guidance for FY25 was reiterated, projecting another record year and double-digit growth.

Financial highlights

• Q1 revenues increased 3% year-over-year to CAD 185 million, the highest first-quarter revenue on record.

• Adjusted EBITDA was CAD 18 million (9.6% margin), down from CAD 21 million (11.9%) last year, reflecting revenue mix and higher investments.

• Adjusted net profit was CAD 10.5 million (CAD 0.88 per diluted share), down from CAD 14 million last year; net loss of CAD 1 million due to non-cash charges.

• Operating free cash flow was CAD 13 million (73% conversion from Adjusted EBITDA); trailing 12-month operating free cash flow was CAD 68 million (77% conversion).

• Gross margin was 32%, slightly below last year but marking the 11th consecutive quarter above 30%.

Outlook and guidance

• FY25 revenue guidance maintained at CAD 800–880 million, implying double-digit growth for the eighth consecutive year.

• Adjusted EBITDA guidance for FY25 is CAD 96–106 million, with double-digit growth at the midpoint.

• Approximately 73% of FY25 revenue is covered by backlog and recurring streams.

• Guidance includes full-year contributions from recent acquisitions but excludes future deals.

• Guidance assumes no major changes in economic environment, defense spending, supply chains, or interest rates.