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, a 9% increase.

• The company signed CAD 154 million in new gross contracts and ended the quarter with a backlog of CAD 1.1 billion, supporting future growth.

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

• Strategic hires and expansion in the U.K., Europe, and U.S. defense markets, including 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.

Financial highlights

• Q1 revenues increased 3% to CAD 185 million, the highest ever for a first quarter.

• Adjusted EBITDA was CAD 18 million (9.6% margin), down from CAD 21 million (11.9%) year-over-year, mainly due to 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 31.8%, slightly lower than 32.5% a year ago, but marked 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, also reflecting double-digit growth.

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

• Guidance includes full-year contributions from recent acquisitions but excludes future deals; any new M&A would be incremental.

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